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A charity association pays 100 or 200 units when an accident happens to one of its members in order to share the risk. 2/3 of
A charity association pays 100 or 200 units when an accident happens to one of its members in order to share the risk.
2/3 of the members tend to choose 100, 1/3 of them 200.
The number of members is 100. The accident rate is 0.01 for each member. All these data are valid for 1 year.
a) Find the distribution function Fs(s) for the total payout, S, for the year.
b) E(S)=? and s=?
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