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Risk, uncertainty and insurance

Edexcel 9EB0T4-4aA-levelLesson packSubscription
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  • 10 questions
  • 45 marks
  • about 55 minutes
  • marked instantly

Question types: short answer, multiple choice, true or false, fill the gap, matching.

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A cyclist who has just bought a fully comprehensive bike-insurance policy starts leaving their bike unlocked outside shops for a few minutes at a time — something they would never have risked before being insured. This is an example of:

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About this resource

Edexcel Economics B (9EB0) Theme 4 'Making markets work' (Paper 1), Unit T4-4 'Risk and the financial sector' — spec ref 4.5.1. FIRST lesson of the final Theme-4 unit: the key distinction between RISK (probabilities can be estimated/quantified) and UNCERTAINTY (probabilities are unknowable); how…

19 slides.

Lesson outline

  1. Do Now — Retrieval
  2. Hinge Check — Everyday Word, Technical Meaning
  3. Risk vs Uncertainty
  4. Risk vs Uncertainty — What's Shared, What's Different
  5. Quick Check — Risk or Uncertainty?
  6. How Firms and Individuals Manage Risk
  7. Hinge Check — Which Risk Strategy?
  8. Insurance — Transferring Risk Through Pooling
  9. Hinge Check — Why Can Insurers Make a Profit?
  10. Two Insurance Problems — Moral Hazard and Adverse Selection
  11. Hinge Check — Moral Hazard or Adverse Selection?
  12. Forward and Futures Markets — Hedging
Unit bundleTheme 4 · Making markets work
Part of: Theme 4 · Making markets work: the whole unitEvery resource in the unit in one zip.

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