Rainie owns a $200,000 house and has a 5% chance of experiencing a fire in any givenyear. Assume that only one fire per year can occur and that if a fire occurs, the house iscompletely destroyed.1.Suppose that Rainie purchases a full insurance contract from Lemonade InsuranceCompany for an actuarially fair premium. This contract would pay all losses due to thefire. Assume that Rainie's contract is the only insurance contract Lemonade InsuranceCompany sold.What is the probability distribution of total losses for Lemonade InsuranceCompany if they sell a contract to Rainie?a.b.What is the actuarially fair premium [AFP] Lemonade Insurance Company willcharge Rainie in the coming year? Show your workWhat is the amount of risk Lemonade Insurance Company faces if they haveRainie as their only customer? Show your workс.

Answered: Image /qna-images/answer/82a5cdb2-dc7b-4596-aad8-c305f30e8baa.jpg

Answered: Rainie owns a $200,000 house and has a…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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A life insurer issued a special endowment insurance policy to a life aged 35, with term 5 years. The death benefit payable at the end of the year of death, is equal to £1, 000 plus the reserve that would have been held at the end of the year had the policyholder been alive. The maturity benefit (benefit paid at maturity if the policyholder still alive) is £1, 000. The premium is £200, payable annually in advance. The basis is AM92 ultimate life table and the interest is 4% per annum. (a) Find the reserve just before the payment of the 3rd premium by using the recursive relation between reserves. (b) Find the policy value at issuance using the same recursive method as above. (c) Explain why your answer to (b) is not consistent with the equivalence principle and give two examples of how this may have arisen.
James has an investment worth $175,609.50. The investment will make a special payment of X to James in 1 month from today and the investment also will make regular, fixed monthly payments of $1,440.00 to James forever. The expected return for the investment is 1.23 percent per month and the first regular, fixed monthly payment of $1,440.00 will be made to James in one month from today. What is X, the amount of the special payment that will be made to James in 1 month? An amount less than $58,600.00 or an anmount greater than $179,600.00 An amount equal to or greater than $58,600.00 but less than $88,950.00 An amount equal to or greater than $88,950.00 but less than $146,400.00 An amount equal to or greater than $146,400.00 but less than $176,000.00 O An amount equal to or greater than $176,000.00 but less than $179,600.00 Com SHEMA
Exemptions may include Select one: O a. taxable income including all deductions. O b. those in an employee's family who are dependents. hit O c. taxable income less all deductions. O d. those in an employee's family who are not dependents.
if in a 2 party race, party 1 is leading in the age category 45 years and under by 10% and that category represents 60% of the electorate and party #2 is leading in the over 45 years by 10% and that category represents 40% of the electorate. Show in percentage the deficit that party 2 needs to make up.
Consider the following bargaining problem: Two siblings Naa and Nii have to have Gh20 million they inherited from their parents between them. Naa gets to make an initial offer. Nii then gets to respond by either accepting Naa's initial offer or offering a counter offer. Finally, Naa can respond by either accepting Nii's offer or making a final offer. If Nii does not accept Naa's final offer both Nii and Naa get nothing. Nii discounts the future at 10% (i.e., future earnings are with 10% less than current earnings) while Naa discounts the future at 20%. Calculate the Nash equilibrium of this bargaining problem.
Veterans Day is an official United States public holiday that honors military veterans who served in the United States Armed Forces. It is observed annually on November 11 and coincides with other holidays, including Armistice Day and Remembrance Day, celebrated in other countries that mark the anniversary of the end of World War I. Major hostilities of World War I were formally ended at the 11th hour of the 11th day of the 11th month of 1918, when the Armistice with Germany went into effect. The United States previously observed Armistice Day. The U.S. holiday was renamed Veterans Day in 1954. For all 2017 Veterans Day celebrations, of interest is to determine the mean number of people attending the celebrations. Based on this, what is the population of interest? a) All 2017 celebrations b) All celebrations c) All Veterans Day celebrations d) All 2017 Veterans Day celebrations For all 2017 Veterans Day celebrations, of interest is to determine the mean number of people…
A US firm, having prior knowledge that Russia would invade Ukraine, bought 100,000 barrels of oil from Heritage Limited , a Trinidad firm . If in January 2022, the US firm enters into a forward contract to purchase the oil at US$65 per barrel to settle in November 2022, what is the gain/loss on the contract to the US firm? The spot price of oil in November averages US$100 per barrel. a. US$35,000 loss b. US$40,000 gain c. US$40,000 loss d. US$35,000 gain
Steven and Donna have been married for 35 years. Both are in great health, but they feel it is time that they start planning for their future health needs. Steven is 60 years old, and Donna is 61 years old. They have been approached by a long-term care insurance salesperson who is offering the following insurance product: . . . . Annual maximum benefit: $67,200 or 80% of annual cost, whichever is less. Daily maximum benefit: $187 or 80% of daily cost, whichever is less. Billing cycle: 360 days. Premium for policy with 180-day elimination period: $3,248. Premium for policy with 90-day elimination period: $3,696. Premium for policy with 30-day elimination period: $4,256. Steven and Donna are interested in possibly purchasing one of these policies. Use the following information to help them analyze which policy may be the best alternative, The current annual cost of a good nursing care facility in their area is $91,440, They have $28,000 saved in a money market savings account, $11,200 in…
For a lifetime life insurance purchased by someone aged 40, some of the following information is provided: • The death benefit is paid at the end of the year of death of $35000 if you die at age 20 year from first contract, $70000 if dies after 20 years of contract. • Premiums with the same amount are paid on average twice a year for a maximum of 20 years as long as they are alive. ä40 = 18,458 60= 14,904 ä50 = 17,025 ä(2) 40:201 = 19,628 ä(2)50:101 = 17,553 20E40 0,36663 10E50 0,60182 i = 0,05 Calculate the benefit reserve at time 10, that is 10V, using the prospective method! =
ABC enters into a contract to help DEF, a ramen restaurantto design a market strategy to compete with DEF. The contract spans twelve month. DEF will pay P80,000 at the beginning of each month. At the end of the contract, ABC either will give DEF a refund of P25,000 or will be entitled to an additional P15,000 bonus, depending on whether sales at DEF at year- end increased to a target level. At the inception of the contract , ABC estimates a 30% chance that it will not earn the bonus and calculates the contract price based on the expected value of future payments to be received. At the start of the fifth month, circumstances change and ABC revise the probability that it will earn the bonus to 80% What is the adjustment to the service revenue ?

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