An insurance company needs to know how much to charge for a $100,000 policy insuring an event
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An insurance company needs to know how much to charge for a $100,000 policy insuring an event against cancellation due to inclement weather. The probability of inclement weather during the time of the event is assessed as 2 in 100. Once they find C, the cost of the policy to break even, they can add administrative costs and profit to this amount. Find the value of C so that their expected gain is zero.
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Related Book For
Introduction To Probability And Statistics
ISBN: 9780357114469
15th Edition
Authors: William Mendenhall Iii , Robert Beaver , Barbara Beaver
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