An Insurance Policy Costs $140 Per Year,and Will Pay Policyholders

Multiple Choice

An insurance policy costs $140 per year,and will pay policyholders $15,000 if they suffer a major injury (resulting in hospitalization) or $7000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 2200 policyholders will have a major injury and 1 in every 400 a minor injury.What is the company's expected profit on this policy?

A) $115.68
B) $99.32
C) $130.68
D) -$24.32
E) -$297.95