1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
BaLLatris [955]
3 years ago
10

An auto insurance company is implementing a new bonus system. In each month, if a policyholder does not have an accident, they w

ill receive a cash-back bonus of 5 from the company. Among the 1000 policyholder of the auto insurance company, 400 are classified as low-risk drivers and 600 are classified as high-risk drivers. In each month, the probability of zero accidents for high-risk drivers is 0.80 and the probability of zero accidents for low-risk drivers is 0.90. Calculate the expected bonus payment from the company to the 1000 policyholders in one year.
Business
1 answer:
andrey2020 [161]3 years ago
7 0

Answer:

50,400

Explanation:

Using application of total expectation, E;

N= Number of policy holders who have zero accidents in one month

P= Probability

N|Low = 400

N|High=600

P|Low=0.9

P|High=0.8

Therefore E = (N|Low*P|Low)+(N|High*P|High)

E=(400*0.9)+(600*0.8)

E=360+480

E=840

Then Total bonus for the year B

B= E*12*5

B=840*12*5

B=50,400

You might be interested in
How differently would you allocate assets between an elderly couple and a young entrepreneur?
vova2212 [387]

According to  conventional wisdom regarding asset allocation by age, you should hold a proportion of stocks equal to 100 minus your age. Therefore, if you are 40 years old, 60% of your portfolio should consist of equity. Criteria might be better changed to 110 minus your age or 120 minus your age because life expectancy increasing.

By deducting your present age from 100, you can utilize  rule of thumb to determine your asset allocation. It implies that as you get older, you should shift away from equity funds and toward debt funds and fixed income assets in your asset allocation.

To learn more about asset allocation, click here

brainly.com/question/28025267

#SPJ4

8 0
2 years ago
The country in which an International company has its primary headquarters and the larger consumer base is called its
sattari [20]
I feel that economic would be the one that makes sense to me could be wrong though hope this helps
7 0
3 years ago
A buyer with a 15-year, $250,000 loan at a 5.5% interest rate has a monthly principal and interest payment totaling $2,042.71. W
lorasvet [3.4K]

<u>Given:</u>

Loan amount = $250000

Interest rate = 5.5%

Interest payment = $2042.71

<u>To find:</u>

Total amount of interest

<u>Solution:</u>

The total number of months in 15 years = 15\times12=180\text{ years }

Total monthly payments will be 180\times \$2042.71 = \$367687.8

So, the total pay-backs will be $3,67,687.8

Total interest paid will be as follows,

\text{Total interest paid = Total pay-backs - Loan amount}

On plugging-in the values in the above formula we get,

\Rightarrow \$3,67,687.8-\$250,000=\$1,17,687.80

Therefore, the total amount of interest that the borrower will pay over the course of the loan is $1,17,687.80.

8 0
3 years ago
Mary promises to give her car to her friend. the friend sells his current car for a fairly low price because he is expecting to
elixir [45]
<span>If the friend sues Mary, the court most likely will not require Mary to do anything because this was a gift promise. In order for a gift promise to be enforceable by the law, it should be a contract. And in order for it to be a contract, there should be a consideration received by Mary but in this case, no consideration was received by Mary therefore, the promise is unenforceable.</span>
4 0
3 years ago
A firm may pay efficiency wages in an attempt to a. entice workers to work the night shift rather than the day shift. b. improve
BartSMP [9]

Answer:

the answer is: B) improve productivity by reducing turnover.

Explanation:

The efficiency weigh theory states that when employers increase their employees' wages above average market wages, they will earn higher profits due to:

  • An increase in labor productivity since the employees are very motivated to work in the company and employee turnover decreases.
  • The increase in labor productivity and the decrease in employee turnover will offset the increase in costs due to higher wages.
8 0
3 years ago
Other questions:
  • When you code a union that combines two result sets, each result set must have the same number of columns?
    14·1 answer
  • Property rights are
    7·1 answer
  • Country a produces about four times the amount of diamonds in carats produced in country
    5·1 answer
  • Discuss the corporate control of your business. Explain why your business in Mexico is exposed to agency problems
    10·1 answer
  • Which of the following statements about capitalism and socialism is correct?
    14·1 answer
  • Before 1993, the U.S. Forest Service sold timber-cutting rights:
    6·1 answer
  • What are the types of experiences, especially staffing-related ones, that an organization will be likely to have if it does not
    13·1 answer
  • A 12-year capital lease specifies equal minimum annual lease payments. Part of this payment represents interest and part represe
    9·1 answer
  • What do you think makes an engaging public speaker? Explain your answer. in 4-5 sentences.
    12·2 answers
  • Suppose the hot sauce firm cannot reduce the externality without reducing costs. What is a possible next step the government cou
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!