Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Question 1:
Oman Insurance Company sells life insurance policies for 4 years. The amount
payable if the death occurs is OMR 100,000. Oman Insurance company's
actuary has calculated the probability of death of the person.
30 years to 38 years is listed in the following table:
Mortality Table
Age
34
Death 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
58 65
30 31
32 33
35
36
37
38
39
Probab 45
ility
89
88
56
75
94
95
85
Hamid is a 30 year old man who wants to take decision on, at what age it will
be good to enter in the life insurance scheme:
A) 30 years or
в) 3 уears
с) 36 years
The required return on insurance company is 9.05%.
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