FREE Trial S
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

4. Suppose an insurer estimates that an expo- sure has the following loss distribution: S 600,000 with probability 0.01 6 Loss 100,000 with probability 0.02

image text in transcribed

4. Suppose an insurer estimates that an expo- sure has the following loss distribution: S 600,000 with probability 0.01 6 Loss 100,000 with probability 0.02 S 30,000 with probability 0.03 0 with probability 0.94 Claim payments are not expected to be paid until one year after the premium is received. If the interest rate is 5 percent, what is the discounted expected claim cost

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Buyable Your Guide To Building A Self Managing Fast Growing And High Profit Business

Buyable Your Guide To Building A Self Managing Fast Growing And High Profit Business

Authors: Steve Preda

1st Edition

ISBN: 0998447846, 978-0998447841

More Books

Students also viewed these Finance questions

Question

★★★★★
In a recent season, hockey player Evgeni Malkin scored 50 goals in 75 games he played. Assume that his goal production stayed at that level for the next season. Find the probability that he would get...

Answered: 1 week ago

Question

★★★★★
#5 (15pts) A production manager is considering purchasing a machine that will cost $215,000. It is estimated that the new machine will increase the company's annual net cash inflows by $33,000. The...

Answered: 1 week ago

Question

★★★★★
Discuss whether emotions enhance or detract from investor decision-making.

Answered: 1 week ago

Question

★★★★★
The information in the table is from the statement of cash flows for a company at four different points in time (A, B, C, and D). Negative values are presented in parentheses. InstructionsFor each...

Answered: 1 week ago

Question

★★★★★
please dont use chat gpt 4 9 4 . ' '

Answered: 1 week ago

Question

★★★★★
Leon Inc. will deposit $ 57,400 in a 4% fund at the end of each year for 6 years beginning December 31, 2020. Click here to view factor tables What amount will be in the fund immediately after the...

Answered: 1 week ago

Question

★★★★★
Prepare a Life Cycle Assessment of returnable and non-returnable glass bottles used for the production of soda. The bottles have a capacity of 300 mL. A returnable bottle has a mass of 250 g and...

Answered: 1 week ago

Question

★★★★★
Consider the design of an engineered wetland amended with limestone to treat acidic drainage from a coal mine. For the purposes of this problem, we will focus on the total dissolved solids (TDS) of...

Answered: 1 week ago

Question

★★★★★
Hudson Jewelers' current layout displays jewelry designs from the CAD system on a screen in the front of the store. However, customers have little privacy when designing jewelry there. What are the...

Answered: 1 week ago

Question

★★★★★
You deposit $A today in a fund paying interest at j4 = 6%. You plan to make quarterly withdrawals for 5 years (for a total of 20 withdrawals), with the first deposit made 1 year from now. The first...

Answered: 1 week ago

Question

★★★★★
2. Titanic Corporation has three investment centre as below: Centre Nike Pine Feira (RM) (RM) (RM) Sales Operating income Average operating assets 4,000,000 6,000,000 3,500,000 4,000,000 6,000,000...

Answered: 1 week ago

Question

★★★★★
2. Compare the experiences for implementing internal social networks of the two organizations. Why was one more successful than the other? What role did management play in this process? Social...

Answered: 1 week ago

Question

★★★★★
3. What is the problem that Schiphol is trying to solve? Discuss the business impact of this problem. Conceptually, baggage handling is quite simple. Baggage input is connected to merely two events:...

Answered: 1 week ago

Question

★★★★★
1. Identify the management, organization, and technology factors responsible for impeding adoption of internal corporate social networks. Social networking has never been more popular, with social...

Answered: 1 week ago

Previous QuestionNext Question