Get Answer: Daniel College Student Question Guide
This question focuses on applying theory to practical scenarios.
What This Question Is About
This question relates to daniel college student and requires a structured academic response.
How to Approach This Question
Focus on explaining concepts clearly and supporting them with examples.
Key Explanation
This topic involves daniel college student. A strong answer should include explanation, application, and examples.
Original Question
Daniel is a college student at UNLV. He has a low-deductible health insurance as below and he pays $250 for her monthly premium. Recently, he was hospitalized and received a medical bill of $3,500. – Deductible: $400 – Coinsurance: 15% – Out-of-pocket maximum: $4,500 1.1 Calculate his total out-of-pocket cost (premium is not included). 1.2 Calculate the cost that the insurance company would pay. 1.3 Due to his health condition (young/healthy), he is not expected to utilize healthcare services frequently and want to minimize his financial burden. Describe how his health condition would affect 1) the insurance premium (e.g., increase or decrease) and 2) deductible. 1.4 As a health plan specialist, recommend the most suitable health plan—high- deductible, low-deductible, or HMO—that best alleviates his financial burden. Provide a rationale for your recommendation. 2. Assume the following probability and cost – Revenue is $2,500 – Probability of illness: 0.15 – Probability of no illness: ? – Cost if ill: $1,000 Cost if no illness: $30 2.1 What is probability of no illness? (Hint: Use probability of illness) 2.2 What is the expected cost of illness? 2.3 What is the expected cost of no illness? 2.4 Calculate the expected profit. Show your work. 3 In Figure 8.1 in the textbook (or lecture slides), Elizabeth’s expected wealth E(W) is $19,000 and her expected utility is 194. 3.1 Suppose that the probability of illness for Elizabeth increases to 0.5. Given that she is still risk-averse and wealth if well and ill don’t change, calculate her expected wealth. Show your work. 3.2 Calculate the expected utility if the probability of illness is 0.5. Show your work (wealth if well and ill don’t change). 3.3 As the probability of illness for Elizabeth increases, is she more likely to buy insurance or less likely to buy it? Explain why. Use certainly utility and expected utility curves. 3.4 If Elizabeth is risk-neutral and the probability of illness is close to 99%, what happens to her gains? Is she more likely or less likely to buy insurance? Explain why.
******CLICK ORDER NOW BELOW AND OUR WRITERS WILL WRITE AN ANSWER TO THIS ASSIGNMENT OR ANY OTHER ASSIGNMENT, DISCUSSION, ESSAY, HOMEWORK OR QUESTION YOU MAY HAVE. OUR PAPERS ARE PLAGIARISM FREE*******."
