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A disability policy is represented by the following Markov chair: Healthy Disabled Dead 2 You are given: (i) A benefit of 10000 is paid at

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A disability policy is represented by the following Markov chair: Healthy Disabled Dead 2 You are given: (i) A benefit of 10000 is paid at the end of the year of death. (ii) A benefit of 1000 is paid at the end of the year of transition to the disabled state. (iii) The following probabilities: 4p = 0.75 gp = 0.10 x+9 = 0.05 02 Preg = 0.01 Pity = 0.02 (iv) The following reserves at the ends of the indicated years: Year Healthy Disabled 9 1710 5800 10 1770 5950 (v) Premium is 300, paid at the beginning of the year if healthy. (vi) Expenses are 5% of premium plus 10. (vii) i =0.06 Calculate Tho, the tenth year profit per policy issued. Calculate II6, the profit in year 6 per policy issued

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