An insurance company pays 90% of the amount that exceeds a deductible of 200 $, with a maximum payment of 1,800$. The company loads the expectation of this random variable by 20%, and charges this premium to the policyholder. If the losses are exponentially distributed with a mean of 950$, what is the probability that a claim surpasses the premium?
An insurance company pays 90% of the amount that exceeds a deductible of 200 $, with a maximum payment of 1,800$. The company loads the expectation of this random variable by 20%, and charges this premium to the policyholder. If the losses are exponentially distributed with a mean of 950$, what is the probability that a claim surpasses the premium?
Chapter8: Sequences, Series,and Probability
Section8.7: Probability
Problem 11ECP: A manufacturer has determined that a machine averages one faulty unit for every 500 it produces....
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