Problem 5 You are given: i) In 2009, losses follow a Pareto distribution with parameters θ--400...
For a liability coverage, you are given: Losses for each insured follow an exponential distribution with mean (alpha) (alpha)varies by insured. (alpha)follows a single-parameter Pareto distribution with parameter= 1, with= 1000. Calculate the probability that a loss will be less than 500. (a) 0.2131(b) 0.3131(c) 0.4131(d) 0.5131(e) 0.6131