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Suppose a life insurance company sells a $250,000 one-year term life insurance policy to a 22-year-old female for $330. The probability that the female survives
Suppose a life insurance company sells a $250,000 one-year term life insurance policy to a 22-year-old female for $330. The probability that the female survives the year is 0.999478. Compute and interpret the expected value of this policy to the insurance company.
What is the expected value? how do I figure out this problem?
Thank you!
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