Firms will continue to enter the insurance industry as long as
A) uncertainty exists
B) there are profits to be made in selling insurance
C) the population in the risk pool remains very small

Question

Quizplus · Accepted Answer

Firms will continue to enter the insurance industry as long as there are profits to be made in selling insurance. Without the potential for profits, firms would not have an incentive to enter and compete in the industry. Uncertainty and the size of the population in the risk pool are factors that can impact profits, but they are not the primary driver for firms entering the industry.

Firms Will Continue to Enter the Insurance Industry as Long