! 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%?

Answered: Image /qna-images/answer/b9b36684-cc51-4208-a0e3-f71ae83c6240.jpg

Answered: An insurance company uses the model of…

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter2: Mathematics For Microeconomics

Section: Chapter Questions

Problem 2.16P

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