Please use the following information answer questions 31 ~34…
Please use the following information answer questions 31 ~34. A firm has the following probability distribution for annual losses due to vandalism. Annual Losses Probability $ 0 .80 $ 5,000 .15 $ 20,000 .05 The firm has the following risk management options: Retention Retention + Safety, Safety program costs $1,000, and reduces losses by half. (e.g., reduces $5,000 to $2,500, reduces $20,000 to $10,000) Deductible insurance, Coverage limit = $10,000, Deductible = $600, Premium = $1,300