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
Flura [38]
3 years ago
9

There is a 0.9986 probability that a randomly selected 29 -year-old male lives through the year. A life insurance company charge

s $176 for insuring that the male will live through the year. If the male does not survive the year, the policy pays out $110 comma 000 as a death benefit. Complete parts (a) through (c) below.a. From the perspective of the 29-year-old male, what are the monetary values corresponding to the two events of surviving the year and not surviving?The value corresponding to surviving the year is $nothingThe value corresponding to not surviving the year is $nothing(Type integers or decimals. Do not round.)b. If the 29-year-old male purchases the policy, what is his expected value? Can the insurance company expect to make a profit from many such policies? Why?From the point of view of the insurance company, the expected value of the policy is
Mathematics
1 answer:
Oduvanchick [21]3 years ago
8 0

Answer:

a) The value corresponding to surviving the year is -$176.

The value corresponding to not surviving the year is $109,824.

b) From the point of view of the insurance company, the expected value of the policy is $22.

As the expected value is positive, the company is expected to make profits from many such policies. According to the Law of large numbers, increasing the amount of policies, the deviation from the expected result will decrease. If the amount of policies is big enough, a profit is guaranteed for the company.

Step-by-step explanation:

a. From the perspective of the 29-year-old male, what are the monetary values corresponding to the two events of surviving the year and not surviving?

The two events and the montery values for each are:

1) Surviving. The probability is 0.9986 and the monetary value is -$176.

2) Not surviving. The probability is (1-0.9986)=0.0014 and the monetary value is ($110,000-$176)=$109,824.

b. If the 29-year-old male purchases the policy, what is his expected value? Can the insurance company expect to make a profit from many such policies? Why?

The expected value can be calculated from the possible outcomes multiplied by its probabiltity of occurrence.

From the 29-year-old male, the expected value is:

E(x)=\sum x_ip_i=0.9986*(-176)+0.0014*(109,824)=-175.75+153.75=-22

The expected value for the company is the negative of the expected value of the client, so it has a expected value of $22 per person.

As the expected value is positive, the company is expected to make profits from many such policies. According to the Law of large numbers, increasing the amount of policies, the deviation from the expected result will decrease. If the amount of policies is big enough, a profit is guaranteed for the company.

You might be interested in
What is the reciprocal of 20/32
ahrayia [7]

Step-by-step explanation: The reciprocal of 20/32 is 32/20. Reciprocal is just flipping a number. For an example: The reciprocal of 98/12 is 12/98.

Hope this helps! :D

7 0
3 years ago
Plizzz answer asap!!!!!​
Anarel [89]

The letters spell "ADD AND SUBTRACT LIKE TERMS ONLY".

3 0
3 years ago
4 Solve the system to find the y-value of the
ser-zykov [4K]

Answer: B

Step-by-step explanation:

7(-2) - 4(1) = -18

-14 - 4 = -18

-18 = -18

TRUE

(-2) + 12(1) = 10

-2 + 12 = 10

10 = 10

TRUE

3 0
2 years ago
A square floor tile has a diagonal 19 inches long. What is the area of the tile?
Anit [1.1K]

Answer:

C

Step-by-step explanation:

The answer is C because you plugin using the area formula.

3 0
3 years ago
A given field mouse population satisfies the differential equation dp dt = 0.5p − 410 where p is the number of mice and t is t
AfilCa [17]

Answer:

as shown in the attached file.

Step-by-step explanation:

The detailed, step by step explanation and application of integral with appropriate substitution to get the expression for the time of extinction is as shown in the attachment.

4 0
3 years ago
Other questions:
  • 2 1/3 - 3 3/4 how to solve
    9·1 answer
  • Please help me with this<br>explain<br>BRAINLIEST AVAILABLE!!
    13·2 answers
  • Rational number between 2 and 3 ?
    12·2 answers
  • How many distinct permutations can be formed using the letters of the word “TALLAHASSEE”?
    11·1 answer
  • I need help ASAP please ;-; are the two triangles similar (yes or no) and are the congruent (yes or no) btw what’s is x=?
    5·1 answer
  • Expand the following by using distributive property 6(-3w+1/3)
    7·2 answers
  • I need help please?!!!!
    15·2 answers
  • Find the sales tax....
    13·1 answer
  • What is equivalent to 0 = 2x2 - 16x – 18 when completing the<br> square?
    14·1 answer
  • Find the median number for 10,5,7,9,18,15,17,14,16,17,15,19,5
    9·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!