Question
You are given the following table: Range of Loss Amount Midpoint Dollar Amount of Loss Number of Losses Total $ Amt. of Losses $1-2000 $1,000
You are given the following table:
| Range of Loss Amount | Midpoint Dollar Amount of Loss | Number of Losses | Total $ Amt. of Losses |
| $1-2000 | $1,000 | 200 | $200,000 |
| $2000-10,000 | $6,0000 | 30 | $180,000 |
| Greater than $12,000 | NA | 0 | 0 |
1. Use the information in the table to find the average severity per claim
2. Use the information in the table to estimate a probability distribution for the loss severity per claim.
3. Using your answers from question 3, part (a) and question 2, part ( b), use convolution to find the average loss.
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The Budget Building Book For Nonprofits
Authors: Murray Dropkin, Jim Halpin, Bill La Touche
2nd Edition
0787996033, 978-0787996031
