An insurance company uses the model of collective risks in multiple periods bymeans of a Poisson-compound-Exponential process. The Poisson intensity equals 20,and the mean claim per period is of $140. The company plans to continuosly chargethe equivalence premium with a loading percentage of 55%.What should the initial wealth of the company be, so that the probability of ruin isless than 5%?

Given:- Poisson intensity ()=20 claims per period- Mean claim = $ 140 per claim- Loading percentage…

Answered: An insurance company uses the model of…

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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