A investment company has an asset A that will produce a cash flow of $5.500 with prob. 0.3 and$8,800 with prob. 0.7. They also own an asset B that pays $1,550 with prob. 0.5 and $3.500 withprob. 0.50. In this case, the probability that the company will earn a total payoff of $10,350 fromtheir portfolio of assets isand the expected value of this portfolio is_O a15: $10.335O 0.15: $10885O 035: $1088SO 035, $10.33s

When the expected value of a discrete random variable is calculated, it's simply the sum of the all…

Answered: A investment company has an asset 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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ony runs a cell phone kiosk in the mall and has 244 potential customers each day. He has a 7 % chance to make a sale to each customer. Use continuity correction to normally approximate the following probabilities.Round to 4 decimal places.a. The probability that he makes AT LEAST 18 sales b. The probability that he makes AT MOST 16 sales
An insurance company insures a house worth P4.500,000 for an annual premium of P25,000. If the company figures that the probability of the house being burned down by Gre is 0.005, what will be the company's expected profit?
Determine the following probabilities. Leave your answer as a percent to the nearest tenth (one decimal after converting to %). The probability of spinning an even number or multiple of 5 on the equal section spinner with numbers 1-20. Leave your answer as a percent to the nearest tenth (one decimal) after converting to %. You can leave out the % sign.
A 37-year-old woman purchases a $100,000 term life insurance policy for an annual payment of $480. Based on a period life table for the U.S. government, the probability that she will survive the year is 0.999055. Find the expected value of the policy for the insurance company. Round to two decimal places for currency problems.
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The probability that a 30-year-old male in the U.S. will die within one year is about 0.00142. An insurance company is preparing to sell a 30-year-old male a one-year, $45,000 life insurance policy. How much should it charge for its premium in order to have a positive expectation for the policy? (Round your answer to the nearest dollar.)
An insurance company sells a one year term life insurance policy to an 80 year old woman. The woman pays a premium of $1000. If she dies within one year, the company will pay $18,500 to her beneficiary. According to the company's statistics department, the probability that an 80 year old woman will be alibve one year later is 0.9581. Find the expected value of the insurance company's profit.
An insurance policy on an electrical device pays a benefit of $2400 if the device fails during the first year. The amount of the benefit decreases by $800 each successive year until it reaches 0 . If the device has not failed by the beginning of any given year, the probability of failure during that year is 0.29.Find the expected benefit under this policy.
An analyst attempting to predict a corporation’s earnings next year believes that the corporation’s business is quite sensitive to the level of interest rates. He believes that, if average rates in the next year are more than 1% higher than this year, the probability of significant earnings growth is 0.1. If average rates next year are more than 1% lower than this year, the probability of significant earnings growth is estimated to be 0.8. Finally, if average interest rates next year are within 1% of this year’s rates, the probability for significant earnings growth is put at 0.5. The analyst estimates that the probability is 0.25 that rates next year will be more than 1% higher than this year and 0.15 that they will be more than 1% lower than this year.a. What is the estimated probability that both interest rates will be 1% higher and significant earnings growth will result?b. What is the probability that this corporation will experience significant earnings growth?c. If the…
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