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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 $6,500. Based on your work environment's history, the probability of a serious accident is 0.007, 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 Xx P(X) (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent

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 $6,500. Based on your work environment's history, the probability of a serious accident is 0.007, 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 Xx P(X) (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent

College Algebra
College Algebra
10th Edition
ISBN:9781337282291
Author:Ron Larson
Publisher:Ron Larson
Chapter8: Sequences, Series,and Probability
Section: Chapter Questions
Problem 41CT: On a game show, a contestant is given the digits 3, 4, and 5 to arrange in the proper order to form...
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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 $6,500. Based on your work environment's history, the probability of a serious accident is 0.007, 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) (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent
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 $6,500. Based on your work environment's history, the probability of a serious accident is 0.007, 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) (b) Compute the company's expected net gain on this policy. Round your answer to the nearest cent
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