An insurance agency services many customers who have purchased both a homeowner’s policy and a car policy from the agency. For each type of policy, a deductible amount must be specified. For a car policy, the choices are $0, $50, and $100, and 25%, 25%, and 50% of customers have these deductibles respectively. It means P(X=$0) = 0.25, etc. For a homeowner’s policy, the choices are 0, $200, and $500 and 30%, 30%, and 40% of customers have these deductibles respectively. It means P(Y=$0) = 0.3, etc. Suppose an individual with both types of policy is selected at random from the agency’s files. Let X = the deductible amount on the car policy and Y = the deductible amount on the homeowner’s policy. Assume X and Y are independent. a. Find the joint probability mass function of X and Y (write it as a table). b. Find median car insurance policy deductible. c. Find average homeowner’s policy deductible.
Unitary Method
The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.
Speed, Time, and Distance
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Profit and Loss
The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.
Units and Measurements
Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experiments to set up the devices.
An insurance agency services many customers who have purchased both a homeowner’s policy and a car policy from the agency. For each type of policy, a deductible amount must be specified.
For a car policy, the choices are $0, $50, and $100, and 25%, 25%, and 50% of customers have these deductibles respectively. It means P(X=$0) = 0.25, etc.
For a homeowner’s policy, the choices are 0, $200, and $500 and 30%, 30%, and 40% of customers have these deductibles respectively. It means P(Y=$0) = 0.3, etc.
Suppose an individual with both types of policy is selected at random from the agency’s files. Let X = the deductible amount on the car policy and Y = the deductible amount on the homeowner’s policy.
Assume X and Y are independent.
a. Find the joint probability mass
b. Find
c. Find average homeowner’s policy deductible.
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