4.87 Fire insurance. An insurance company looks at the records for millions of homeowners and sees that the mean loss from fire in a year is μ = $300 per person. (Most of us have no loss, but a few lose their homes. The $300 is the average loss.) The company plans to sell fire insurance for $300 plus enough to cover its costs and profit. Explain clearly why it would be stupid to sell only 10 policies. Then explain why selling thousands of such policies is a safe business.