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Suppose the Value of Life Is Estimated by Comparing the Earnings

Question 23

Multiple Choice

Suppose the value of life is estimated by comparing the earnings and probabilities of death from working on a fishing boat in Alaska with the earnings and probabilities of death from working in a fish processing plant in Alaska.The analysis concludes that a year of life is valued at $6 million.If risk-loving people take the jobs on the boats and risk-averse people take jobs at the processing plants,the estimate will:


A) overstate by at least two times the value of a life for the average person.
B) overstate by an unknown amount the value of a life for the average person.
C) be approximately equal to the value of a life for the average person.
D) understate by an unknown amount the value of a life for the average person.

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