Question: You are considering purchasing a small herd of goats. In order to ensure your new herd of goats against things such as alien abduction, sink

You are considering purchasing a small herd of goats. In order to ensure your new herd of goats against things such as alien abduction, sink holes, corona virus, train derailments, and accidental dynamite explosions, you will have to pay the insurance company $800 per year. Upon further research, you find that the expected value of each policy is $255.

a. What is the value of the policy to you? b. What is the value of the policy to the insurance company? c. Explain why this is a good bet for the insurance company?

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