Mathematics, 14.07.2020 22:01 chloesmolinski0909
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 0.80, 0.08, 0.10, and 0.02, respectively. A particular company offers three different policies: a $200 deductible with a $780 premium, a $500 deductible with a $700 premium, and a $1000 deductible with a $590 premium. (A $Y deductible means the insurance company pays X - Y for X Y and 0 for X Y.) Compute the expected profit for each policy.
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Let X be the damage incurred (in $) in a certain type of accident during a given year. Possible X va...
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