robability of a mild accident is 0.014. et X be the insurance company's net gain or loss on the policy described. (a) Create a probability distribution for X. Enter the possible values of X in ascending order from left to right. 139500 1x T✓ X -6700 P(X) 0.961 1x 0.014 279000 0.005 x x (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent. €99207 Tx
robability of a mild accident is 0.014. et X be the insurance company's net gain or loss on the policy described. (a) Create a probability distribution for X. Enter the possible values of X in ascending order from left to right. 139500 1x T✓ X -6700 P(X) 0.961 1x 0.014 279000 0.005 x x (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent. €99207 Tx
A First Course in Probability (10th Edition)
10th Edition
ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
Section: Chapter Questions
Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...
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
Transcribed Image Text:You purchase a workers' compensation insurance policy to protect against accidents at your workplace. If you have a serious accident, the policy will pay you $279,000. If you have a mild accident, the policy will pay you $139,500. The premium for the policy is $6,700. Based on your work environment's history, the probability of a serious accident is 0.005, and the
probability of a mild accident is 0.014.
Let X be the insurance company's net gain or loss on the policy described.
(a) Create a probability distribution for X. Enter the possible values of X in ascending order from left to right.
X
P(X)
-6700
0.981
X
X
139500
0.014
X
279000
0.005
X
X
(b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent.
$ 9920.7
X
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