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3 years ago

What role does math play in the insurance industry?

Business

1 answer:

Nataly_w [17]3 years ago

3 0

Answer:

The correct answer based on the options given is A)

Explanation:

Actuarial Science is a branch of mathematics predominantly used by the Insurance Industry to create a formula or mathematical model that enables them to charge a profit-oriented rate for a particular risk.

If insurance companies charge arbitrarily, they may overcharge thus leading to a collapse of the system. If they undercharge, the system of pooling risks becomes unsustainable as claim paying capabilities are reduced.

Hence the need to use a mathematical model to ensure that rates give room for the ability of the system to meets it's obligations when they arise and for the companies to make a profit.

The use of models is the reason why sometimes there are hard markets in insurance and at other times there are soft markets.

Cheers!

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marin [14]

Answer:

$5,230

Explanation:

Account receivable balance = $310,000

Credit balance in allowance for uncollectible accounts = $970

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So by considering the above information, the bad debt expense is

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3 years ago

The beginning inventory at Midnight Supplies and data on purchases and sales for a three-month period ending March 31, are as fo

agasfer [191]

Answer:

Using LIFO:

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Explanation:

KINDLY CHECK ATTACHED PICTURE

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3 years ago

Moonbeam Company manufactures toasters. For the first 8 months of 2020, the company reported the following operating results whi

Lelu [443]

Answer:

Moonbeam Company

a) Incremental analysis for the special order:

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Variable costs ($6.62 * 20,800) = (137,696)

Contribution margin = 26,000

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b) Moonbeam should accept the special order. It generates some net income for covering the company's fixed cost and does not exceed the company's plant capacity. It only adds about 4% to the operating plant capacity.

Explanation:

a) Data and Calculations:

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3 years ago

During this period, people who monitor the U.S. economy were constantly on the lookout for signs of inflation. Explain why infla

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Answer:

GDP is higher than normal

Explanation:

This is a situation where GDP is higher than the usual and it shows that the economy is above the employment level and overly active. The extra gross domestic product leads to an increase in demand for goods and services and that leads to high inflation. The initial sighs include, increase in employment rate, more wages, high demand.

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3 years ago

Marginal cost is ________ the average variable cost and the average total cost when they are ________

fredd [130]

Answer: equal to; at their minimum.

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3 years ago