1 suppose the force of interest is a constant 006 and that, Ask an Expert

Statistics

1. Suppose the force of interest is a constant 0.06 and that μ(t) = 0.04 for all t. An insurer sells 100 contracts, each of which pays 1000 upon failure. Assuming a normal approximation, how much should be charged as a single premium on each contract, so that there is a 95% chance that premiums will be sufficient to cover the aggregate claims for this group of 100 contracts.

2. Suppose the contract in above question is sold with premiums paid continuously for life at a level rate, where the security loading θ = 0.10. Assuming a normal approximation, how many contracts must be sold, so there is a 95% chance that total premiums will cover total benefits?

View complete question

Statistics and Probability, Statistics

Category:- Statistics and Probability
Reference No.:- M91710499

Have any Question?Write your Review or question?

Related Questions in Statistics and Probability

Consider the study of two insect populations at two

Consider the study of two insect populations at two experimental stations. At station A, the egg hatch rate (computed from a set of 100 eggs at a time) is known to follow approximately a normal distribution with mean 62% ...

If no payments are made a loan of amount 44000 would

If no payments are made, a loan of amount $44000 would increase to $49103.89 after 2 years of monthly compounding interest. If instead, payments of $718.87 are made at the end of each month, how many years would it be un ...

The local police department must write an average of 5

The local police department must write an average of 5 traffic tickets each day to keep department revenues at budgeted levels. Suppose the number of tickets written per day follows a Poisson distribution with a mean of ...

Acme airlines flies airplanes that seat 20 passengers from

Acme Airlines flies airplanes that seat 20 passengers. From experience, they have learned that, on average, 85% of the passengers holding reservations for a particular flight actually show up for the flight. If they book ...

Thanks for starting our discussion on cash management if

Thanks for starting our discussion on Cash Management. If you think about it this comes down to speeding up collections of cash or slowing down disbursements of cash. Point out some strategies to accomplish it? Give refe ...

In a survey of 3175 adults1487 say they have paid their

in a survey of 3175 adults,1487 say they have paid their bills online in the last year. construct a 99% confidence interval for the population proportion.

Innbspmid-2009 rite aid hadnbspccc-ratednbsp20-year bonds

In? mid-2009, Rite Aid had? CCC-rated, 20-year bonds outstanding with a yield to maturity of 17.3%. At the? time, similar maturity Treasuries had a yield of 5%. Suppose the market risk premium is 4% and you believe Rite? ...

Suppose that 20 of men p20 and 15 of women p 15 are

Suppose that 20% of men (P=.20) and 15% of women (P= .15) are carriers of a particular genetic trait. That trait can only be inherited by a child if both parents are carriers. What is the probability that a child is born ...

1 choose all probability distributions which are

1. Choose all probability distributions which are theoretically related to normal probability distribution 2. The 68-95-99.7 rule states that in a normal distribution 3. For a normal distribution the a mean of 179 and st ...

Letnbspxnbsp age in years of a rural quebec woman at the

Let x = age in years of a rural Quebec woman at the time of her first marriage. In the year 1941, the population variance of x was approximately σ 2 = 5.1. Suppose a recent study of age at first marriage for a rand ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Statistics and Probability Expert