Examine the table above . The insurance company does not know the probabilities of falling sick for each individual. ( a ) If the company charged everybody a premium of Tk.2,000 , who would stay and who would leave the insurance market ? Say why. (All the questions are the same part of one single question. Please answer them all.) ( b ) If the company charged everybody a premium equal to the average of the actuarially fair premiums for all , who would stay and who would leave ? Say why.
Examine the table above . The insurance company does not know the probabilities of falling sick for each individual. ( a ) If the company charged everybody a premium of Tk.2,000 , who would stay and who would leave the insurance market ? Say why. (All the questions are the same part of one single question. Please answer them all.) ( b ) If the company charged everybody a premium equal to the average of the actuarially fair premiums for all , who would stay and who would leave ? Say why.
Holt Mcdougal Larson Pre-algebra: Student Edition 2012
1st Edition
ISBN:9780547587776
Author:HOLT MCDOUGAL
Publisher:HOLT MCDOUGAL
Chapter7: Percents
Section: Chapter Questions
Problem 48CR
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Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
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Question
Examine the table above . The insurance company does not know the probabilities of falling sick for each individual.
( a ) If the company charged everybody a premium of Tk.2,000 , who would stay and who would leave the insurance market ? Say why.
(All the questions are the same part of one single question. Please answer them all.)
( b ) If the company charged everybody a premium equal to the average of the actuarially fair premiums for all , who would stay and who would leave ? Say why.
![Insurance
Prob. of
Lost income
Buyer
falling sick
if sick (Tk.)
A
0.20
15,000
В
0.15
20,000
C
0.10
25,000
D
0.05
30,000
E
0.05
20,000
F
0.15
10,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F60049efa-0574-4fe8-9818-8328013f3c0a%2Fc4f9f045-69ac-48dc-ac21-7fd7dabfac49%2F0gysrh_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Insurance
Prob. of
Lost income
Buyer
falling sick
if sick (Tk.)
A
0.20
15,000
В
0.15
20,000
C
0.10
25,000
D
0.05
30,000
E
0.05
20,000
F
0.15
10,000
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