Question Help ▼ Suppose a life insurance company sells a $230,000 one-year term life insurance policy to a 25-year-old female for $320. The probability that the female survives the year is 0.999646. Compute and interpret the expected value of this policy to the insurance company. The expected value is $ (Round to two decimal places as needed.) Which of the following interpretation of the expected value is correct? O A. The insurance company expects to make an average profit of $29.08 on every 25-year-old female it insures for 1 month. O B. The insurance company expects to make an average profit of $319.89 on every 25-year-old female it insures for 1 year, O C. The insurance company expects to make an average profit of $238.58 on every 25-year-old female it insures for 1 year. O D. The insurance company expects to make an average profit of $21.69 on every 25-year-old female it insures for 1 month. Click to select your answer(s).

Question Help ▼ Suppose a life insurance company sells a $230,000 one-year term life insurance policy to a 25-year-old female for $320. The probability that the female survives the year is 0.999646. Compute and interpret the expected value of this policy to the insurance company. The expected value is $ (Round to two decimal places as needed.) Which of the following interpretation of the expected value is correct? O A. The insurance company expects to make an average profit of $29.08 on every 25-year-old female it insures for 1 month. O B. The insurance company expects to make an average profit of $319.89 on every 25-year-old female it insures for 1 year, O C. The insurance company expects to make an average profit of $238.58 on every 25-year-old female it insures for 1 year. O D. The insurance company expects to make an average profit of $21.69 on every 25-year-old female it insures for 1 month. Click to select your answer(s).

Name: Question Help ▼Suppose a life insurance company sells a $230,000 one-
Uploaded: 2024-03-20T07:06:41.000Z
Channel: Bartleby
Description: Question Help ▼Suppose a life insurance company sells a $230,000 one-year term life insurance policy to a 25-year-old female for $320. The probability that the female survives the year is 0.999646. Compute and interpret theexpected value of this pol

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

See similar textbooks

Similar questions

Amita pays $0.78 to play a game at a local fair that involves receiving the number of quarters that corresponds to the number that comes up on the roll of a die. Using the expected value of the game, compute the expected gain or loss for Amita. Note: Please avoid rounding numbers in the middle of your calculations. However, round your final answer to two decimal places, before entering it in the box below. A negative final answer indicates an expected loss for Amita for playing the game.
A shop sells a particular make of video recorder. Find the minimum number that should be in stock at the beginning of a month so that the shop can be at least 95% sure of being able to meet the demands during the month. None of the choices 0.9626 0.9376 0.9374
A certain model phone costs $599. The probability of the phone breaking over the course of a year is .07. What is the maximum amount you could pay for phone replacement insurance and still have a non-negative expected value on the policy? In other words, for what price or below would it be worth it to get the insurance?
The probability that a 29-year old female will die within 1-year is 0.000594. If an insurance company sells a 1-year, $50000 life insurance policy to a 29-year old female for $77, what is the expected value for the insurance company? Round your answer to the nearest cent.
A 28-year-old man pays $176 for a one-year life insurance policy with coverage of $199462. If the probability that he will live through the year is 0.926, what is the expected value for the insurance policy? Round to the nearest dollar. In your response do not use any words or symbols (i.e. $).
K Suppose a life insurance company sells a $220,000 1-year term life insurance policy to a 20-year-old female for $230. According to the National Vital Statistics Report, 58(21), the probability that the female survives the year is 0.999544. Compute and interpret the expected value of this policy to the insurance company. The expected value is $. (Round to the nearest cent as needed.) Which of the following interpretations of the expected value is correct? Select the correct choice below and fill in the answer box to complete your choice. (Round to the nearest cent as needed.) OA. The insurance company expects to make a profit of $ on every 20-year-old female it insures for 1 month. OB. The insurance company expects to make a minimum profit of $ on every 20-year-old female OC. The insurance company expects to make a profit of $ on every 20-year-old female it insures for 1 year. OD. The insurance company expects to make a maximum profit of $ on every 20-year-old female it insures for 1…
Suppose you pay $10 to roll a fair die with the understanding that you will get back $17 for rolling a 1 or a 2, nothing otherwise. What is your expected value? Round to the nearest cent. In your response do not use any words or symbols (i.e. $).
Amita pays $0.73 to play a game at a local fair that involves receiving the number of quarters that corresponds to the number that comes up on the roll of a die. Using the expected value of the game, compute the expected gain or loss for Amita. Note: Please avoid rounding numbers in the middle of your calculations. However, round your final answer to two decimal places, before entering it in the box below. A negative final answer indicates an expected loss for Amita for playing the game.
An insurance policy on an electrical device pays a benefit of $2400 if the device fails during the first year. The amount of the benefit decreases by $800 each successive year until it reaches 0 . If the device has not failed by the beginning of any given year, the probability of failure during that year is 0.29.Find the expected benefit under this policy.
Suppose that you are offered the following "deal." You roll a six sided die. If you roll a 6, you win $17. If you roll a 2, 3, 4 or 5, you win $4. Otherwise, you pay $6. a. Complete the PDF Table. List the X values, where X is the profit, from smallest to largest. Round to 4 decimal places where appropriate. Probability Distribution Table P(X) b. Find the expected profit. $ (Round to the nearest cent) c. Interpret the expected value. O This is the most likely amount of money you will win. Oif you play many games you will likely win on average very close to $4.50 per game. O You will win this much if you play a game. d. Based on the expected value, should you play this game? O No, since the expected value is negative, you would be very likely to come home with less money if you played many games. O Yes, since the expected value is positive, you would be very likely to come home with more money if you played many games. O No, this is a gambling game and it is always a bad idea to gamble.…