Assume that a certain insurer has 1,000 policyholders of type 1 and 2,500 policyholders of type 2.Policyholders will have losses of either 0, 50, 200, or 500 with the following probabilities:Loss Pr(Loss Type 1) Pr(Loss|Type 2)0.700.80500.150.102000.100.075000.050.03All policyholders have an ordinary deductible of 100 and all losses are independent.(a) Calculate the loss elimination ratio for the deductible. [436](b) Calculate the mean and variance of the aggregate claims. [77,500, 20,947,500](c) Using the normal approximation, calculate the probability that the total aggregate claims exceed$90,000 [.0032](d) Again using the normal approximation, find the 99% Value-at-Risk. [88,146

In this problem, we are given information about an insurance company's policyholders. The insurer…

Answered: Assume that a certain insurer has 1,000…

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 stock has had the following year-end prices and dividends: Year Price Dividend 1 $ 65.03 — 2 71.90 $ .74 3 77.70 .79 4 63.97 .85 5 74.51 .94 6 86.75 1.01 What are the arithmetic and geometric returns for the stock? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
3. You would like to retire a millionaire! You plan on retiring in 40 years and using historical data you determine that a 5% interest rate compounded quarterly is a reasonable expectation. How much do you need to invest now to have $1000000 in 40 years. How much of the $1000000 that you have earned is interest?
Example 2: Given the following information about ZED Ltd., show the effect of the dividend policy on the market price of its shares, using the Walter's model: = 12% Equity capitalisation rate (K.) Earnings per share (E) Assumed return on investments (r) are as follows: 1) r= 15%
Stocks A and B have the following historical returns: Year 2016 2017 2018 2019 2020 a. Calculate the average rate of return for each stock during the period 2016 through 2020. Round your answers to two decimal places. Stock A: % % Stock A's Returns, ra (20.60%) 39.75 17.25 (3.50) 25.00 Stock B: b. Assume that someone held a portfolio consisting of 50% of Stock A and 50% of Stock B. What would the realized rate of return on the portfolio have been each year? Round your answers to two decimal places. Negative values should be indicated by a minus sign. CV Stock A Stock B's Returns, B (14.30%) 29.80 37.30 (6.60) 11.70 Year 2016 2017 2018 2019 2020 What would the average return on the portfolio have been during this period? Round your answer to two decimal places. Portfolio % c. Calculate the standard deviation of returns for each stock and for the portfolio. Round your answers to two decimal places. Stock B % Portfolio % Stock A % Standard Deviation d. Calculate the coefficient of…
Consider a special fully discrete 20 year endowment insurance on (30). The death benefit, payable at the end of the year of death if death occurs within 20 years, is 250,000, while the endowment benefit which is payable at time 20 is 500,000. Premiums are level and payable at the beginning of each year for 20 years. Using the Standard Ultimate Life Table ( S.U.L.T) with i = 5% determine each of the following: (a.) the premium 7. (b.) 10 V, the reserve at time 10.
Suppose that you have the following payoff table: State of Nature Decision 51 S2 di 250 100 d2 100 -50 150 Suppose that p-0.75 would make you indifferent between a guaranteed payoff of 150 and the lottery. Find your risk premium for the payoff of 150. The answer has no decimals.
4. An insurer issues a 15-year annual premium-due endowment insurance of $100,000 benefit to life (50). The insurer charges an initial expenses of $ 1000 plus renewal expenses of 5% of each subsequent premium after the first premium payment. The premiums are made at the beginning of each year when (50) remains alive before reaching 70 and the benefit is paid at the end of K50 +1 years or when the person reaches the age 70 whichever occurs earlier. (a) Write down the gross future loss random variable L in terms of actuarial notations. (b) Calculate the gross premium-due G by using the Standard Select Survival Model with 5 % per year interest (Table D4) and the equivalence premium principle. 8 (c) Calculate the gross premium policy value V by using the equivalence premium G found in (b).
An insurer issues a 25-year endowment insurance with sum insured $100, 000 to a select life aged 30. The premiums are payable annually throughout the term of the insurance. The insurer incurs initial expenses of $2, 000 plus 50% of the first premium, and the renewal expenses of 2.5% of each subsequent premium. The death benefit is payable immediately on death. Basis: • Mortality: AM92 Select • Rate of interest: 6% a. Write down the expression for the gross future loss random variable at the inception of the contract. b. Calculate the gross premium using the equivalence premium principle.
6) a. b. C. d. What is the present value of $15,000 received today, $2,500 received at the end of each of the next six years and $10,000 received at the end of the 7th year, assuming a required rate of return of 4.50% ? $38,143 $16,899.89 $29,990.22 $35,243
4. a. Suppose that betwee 401(k) and your employer 8.3%compounded annually dollar, after 18 years?
Illu.16 : On 31st Lecember, 2003 Andhra Traders Lid, shored in thei accouts the following balances : Rs. 1.50.000 Debenture Redemption Fund Debenture Redemption Fund Investments 1.50,000 5% Debentures 150,000 On 1st March, 2004, the Company sold the investments for Rs.150,500 and the debentures were paid off. Prepare (a) Debenture A/e (b) Debenture Redemption Fud a/c (c) Debenture Redemption Fund Investment a/e. CS Scanned with CamScanner
7.31. A financial institution has entered into a swap where it agreed to receive quarterly payments at a rate of 2% per annum and pay the SOFR three-month reference rate on a notional principal of $100 million. The swap now has a remaining life of 10 months. Assume the risk-free rates with continuous compounding (calculated from SOFR) for 1 month, 4 months, 7 months, and 10 months are 1.4%, 1.6%, 1.7%, and 1.8%, respectively. Assume also that the continuously compounded risk-free rate observed for the last two months is 1.1%. Estimate the value of the swap.

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