1. Which of the following statements about bearing risk collectively is correct?
A) Bearing risk collectively results in a more cost-efficient outcome.
B) Bearing risk collectively is an application of risk diversification.
C) Bearing risk collectively means that the risk is spread over a larger group.
D) All of the above are correct.
2. Hoyes Lumber generally receives three checks a month in the amounts of $1,200, $1,650, and $2,200. The $2,200 check has a two-day collection delay while the others have a one-day delay. Given this information, what is the amount of the average daily float? Assume each month has 30 days.
1.$241.67
2.$140.79
3.$147.50
4.$168.33
5.$109.18