What general conclusions could you make regarding Wise Owl's performance in the areas below based on the ratios calculated in the first question? Identify the ratio(s) above that led you to each conclusion in each of the areas below. Be sure to provide the answers in order, and clearly label your answers a, b, c, or d.

a. Wise Owl's underwriting results

b. Wise Owl's efficiency of operations

c. Wise Owl's profitability

d. Wise Owl's financial strength

Ratios calculated in the first question:

a. Loss Ratio - Incurred Losses & LAE/earned premium

= 6,000,000/8,000,000

= 0.75

b. Expense Ratio - Underwriting expensve/written premium

=3,000,000/10,000,000

= 0.3

c. Combined ratio - Loss ratio + expense ratio

=0.75+0.3

=1.05

d. Investment Income Ratio - Net investment income/earned premium

= 500,000/8,000,000

=0.0625

e. Overall Oprtating Ratio: Combined ratio-investment income ratio

=1.05-0.0625

=0.9875

f. Capacity ratio: Written premium/surplus

= 10,000,000/7,000,000

=1.4286