Let X be the amount of damage a particular company pays out (in $) for a...
Let X be the amount of damage a particular company pays out (in $) for a certain type of accident during a given year. Possible values of X are 0, 1000, 5000, and 10000, with probabilities .9, .1, .08, and .02, respectively. If the company wishes its expected profit to be $100, what premium amount should it charge?
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Let X be the amount of damage a particular company pays out (in
$) for a...
Let X be the damage incurred (in $) in a certain type of accident during a...
Let X be the damage incurred (in $) in a certain type of accident during a given year. Possible X values are 0, 1000, 5000, and 10000 with probabilities .8 .1 .08 and .02 respectively. a particular company offers a $500 deductible policy. if the company wishes its expected profit to be $100 what preminum amount should it charge?
Let X be the damage incurred (in $) in a certain type of accident during a...
Let X be the damage incurred (in $) in a certain type of accident during a given year. Possible X values are 0, 1000, 5000, and 10000, with probabilities 0.83, 0.08, 0.07, and 0.02, respectively. A particular company offers a $500 deductible policy. If the company wishes its expected profit to be $100, what premium amount should it charge? $
The model for the amount of damage to a particular property during a one-month period is as follo...
The model for the amount of damage to a particular property during a one-month period is as follows: there is a .99 probability of no damage, there is a.01 probability that damage will occur, and if damage does occur, it is uniformly distributed between 1000 and 2000. An insurance policy pays the amount of damage up to a policy limit of 1500. It is later found that the original model for damage when damage does occur was incorrect, and should...
The probability distribution for damage claims paid by the Newton Automobile Insurance Company on collision insurance...
The probability distribution for damage claims paid by the Newton Automobile Insurance Company on collision insurance follows. Payment ($) Probability 0 0.82 500 0.05 1000 0.04 3000 0.04 5000 0.03 8000 0.01 10000 0.01 a. Use the expected collision payment to determine the collision insurance premium that would enable the company to break even. Answer: $ b. The insurance company charges an annual rate of $595 for the collision coverage. What is the expected value of the collision policy for...
Within a certain period of time, let n be the number of health claims (the amount...
Within a certain period of time, let n be the number of health claims (the amount the insurance company pays the insured) of an insurance company, and suppose that the sizes of the claims areXi,... , Xn i.i.d Negative Expo nential with parameter ?. Let P be the premium charged or each policy (the amount the insured pays up front and let Sn-Xi+...+Xn. Assume the total amount of the claims should not exceed the total premium for the rn policies...
An insurance company issues a policy on a horse trailer under the following conditions: The replacement...
An insurance company issues a policy on a horse trailer under the following conditions: The replacement cost ($6,000) will be paid for a total loss. If it is not a total loss, but the damage is more than $3,000, then $2,700 will be paid. Nothing will be paid for damage costing $3,000 or less and of course nothing is paid out if there is no damage. The company estimates the probability of the first three events as 0.08, 0.19, and...
Consider two investments X and Y, where X pays $0 and $10 with equal probability and...
Consider two investments X and Y, where X pays $0 and $10 with equal probability and Y pays 0 with probability 0.75 and $20 with probability 0.25. What investment would an investor choose if her utility function is ux=x2 ux=x ux=1-e-x10 Consider an insurance market with insurance firms being competitive and risk neutral (Zero expected profits in equilibrium) and a risk averse customer with a von-Neumann Morgenstern utility function ux=x1/3. The customer is born with a wealth of $150. There...
An insurance company wants to offer a policy where it pays out $50,000 for death and...
An insurance company wants to offer a policy where it pays out $50,000 for death and $20,000 for disability. It calculates a probability of .0001 that a policy holder will die and a probability of .0003 that a policy holder will become disabled during the course of a year. The company wants to have an expected profit of $25 per year per policyholder. What should the company charge for its annual premium?
show all work Problem 5 An insurance company issues a policy on a car under the...
show all work
Problem 5 An insurance company issues a policy on a car under the following conditions: (1) The replacement cost of $37,000 will be paid for a total loss. (ii) If it is not a total loss, but the damage is more than $11,000, then only $ 10,500 will be paid. (iii) Nothing will be paid for damage costing $11,000 or less and, (iv) Nothing will be paid out if there is no damage. The company estimates, based...
thank you asap please 1 point Number Help A doctor knows 62% of all her patients...
thank you asap please
1 point Number Help A doctor knows 62% of all her patients are late for their appointments. Given 8 randomly selected patients, what is the approximate probability that exactly 4 of them are late for their appointments? (Please answer to 4 decimal places). Number - Question 8 1 point An insurance company issues a policy on a camping trailer under the following conditions: The replacement cost ($17,000) will be paid for a total loss. If it...
The model for the amount of damage to a particular property during a one-month period is as follows: there is a .99 probability of no damage, there is a.01 probability that damage will occur, and if damage does occur, it is uniformly distributed between 1000 and 2000. An insurance policy pays the amount of damage up to a policy limit of 1500. It is later found that the original model for damage when damage does occur was incorrect, and should...
Within a certain period of time, let n be the number of health claims (the amount the insurance company pays the insured) of an insurance company, and suppose that the sizes of the claims areXi,... , Xn i.i.d Negative Expo nential with parameter ?. Let P be the premium charged or each policy (the amount the insured pays up front and let Sn-Xi+...+Xn. Assume the total amount of the claims should not exceed the total premium for the rn policies...
show all work
Problem 5 An insurance company issues a policy on a car under the following conditions: (1) The replacement cost of $37,000 will be paid for a total loss. (ii) If it is not a total loss, but the damage is more than $11,000, then only $ 10,500 will be paid. (iii) Nothing will be paid for damage costing $11,000 or less and, (iv) Nothing will be paid out if there is no damage. The company estimates, based...
thank you asap please
1 point Number Help A doctor knows 62% of all her patients are late for their appointments. Given 8 randomly selected patients, what is the approximate probability that exactly 4 of them are late for their appointments? (Please answer to 4 decimal places). Number - Question 8 1 point An insurance company issues a policy on a camping trailer under the following conditions: The replacement cost ($17,000) will be paid for a total loss. If it...
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