All steps needed to solve a problem must be shown to receive credit 1) Life Insurance You might sell life insurance to a 20-year-old friend. The probability that a 20-year-old man will die in the next year is 0.0007. You decide to charge $2000 for a policy that pays $1 million if your friend dies. a) What is your expected profit or loss on this policy? (30 points) b) Although you expect to make a good profit from your friend, you would be foolish to sell a single policy only to your friend. Why? (10 points) c) Life insurance companies that sell thousands of these policies, on the other hand, would do very well selling policies on exactly these same terms. Explain why. (10 points)