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Under the alternative funding method used by the Trilogy Company, the insurer charges Trilogy an initial premium that is based on the assumption that claims will be 93% of the expected claims for the year. If claims exceed 93% of expected claims, then Trilogy must reimburse the insurer for any additional claims paid, up to 112% of expected claims. The insurer bears the responsibility for paying claims in excess of
112% of expected claims.
From the following answer choices, choose the name of the alternative funding method described.
A. Minimum-premium plan
B. Reserve-reduction arrangement
C. Retrospective-rating arrangement
D. Premium-delay arrangement
Answer: C

To be relevant, financial information has to
I)be provided in a timely manner.
II)comply with the going concern assumption.
III)have predictive and/or confirmatory value.
IV)exclude computations that are difficult to understand.
A. III and IV only
B. I and III only
C. II and III only
D. I and II only
Answer: B

What is the term for the process of moving map outputs to the reducers?
A. Shuffling and sorting
B. Combining
C. Reducing
D. Partitioning
Answer: A

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