Jeremy is on the planning committee for the rock climbing club. He is putting together a trip where members can go outdoor rock
climbing. He is trying to determine how high the group should climb and how long the trip should last. He calls multiple parks in the area that offer rock climbing and collects data on the height of the rock formations and the average time it takes people to reach the top and come back down. The data he found is shown.
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Answer:
the approximate probability that the insurance company will have claims exceeding the premiums collected is
Step-by-step explanation:
The probability of the density function of the total claim amount for the health insurance policy is given as :
Thus, the expected total claim amount = 1000
The variance of the total claim amount
However; the premium for the policy is set at the expected total claim amount plus 100. i.e (1000+100) = 1100
To determine the approximate probability that the insurance company will have claims exceeding the premiums collected if 100 policies are sold; we have :
P(X > 1100 n )
where n = numbers of premium sold
Therefore: the approximate probability that the insurance company will have claims exceeding the premiums collected is