Let ????1, ????2 be two constants with 0 ????1, ????2 1 and define the probability
Question:
Let ????1, ????2 be two constants with 0 ≤ ????1, ????2 ≤ 1 and define the probability function f (x) by the formula f (x) = ????1f1(x) + ????2f2(x), x = 0, 1, 2,…
Find the condition that must be satisfied by the ????i’s so that f is a valid probability function of a random variable, which takes values on the nonnegative integers.
Then, find the mean and variance of the resulting distribution.
Application: In an automobile insurance portfolio, the insurance company estimates that the number of claims made per year by a male driver has a Poisson distribution with parameter ????1, while the number of claims made per year by a female driver has a Poisson distribution with parameter ????2. If it is known that 60% of the insured drivers are males, find the probability function and the expected value of the number of accidents per driver (either male or female) in this portfolio.
Step by Step Answer:
Introduction To Probability Volume 2
ISBN: 9781118123331
1st Edition
Authors: Narayanaswamy Balakrishnan, Markos V. Koutras, Konstadinos G. Politis