Practical Business Math Procedures with Business Math Handbook
12th Edition
ISBN: 9781259725067
Author: Jeffrey Slater, Sharon M. Wittry
Publisher: McGraw-Hill Education
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Chapter 12.1, Problem 1AH
(a)
To determine
The compounded amount at year end of each of the given data.
(b)
To determine
The compounded amount at year end of each of the given data.
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Questions
An insurance company's cumulative incurred claims for the last 5 accident years are given
in the following table:
Development Year
Accident Year 0
2018
1 2 3 4
245 267 274 289 292
2019
255 276 288 294
2020
265 283 292
2021
263 278
2022
271
It can be assumed that claims are fully run off after 4 years. The premiums received for
each year are:
Accident Year Premium
2018
306
2019
312
2020
318
2021
326
2022
330
You do not need to make any allowance for inflation.
1. (a) Calculate the reserve at the end of 2022 using the basic chain ladder method.
(b) Calculate the reserve at the end of 2022 using the Bornhuetter-Ferguson method.
2. Comment on the differences in the reserves produced by the methods in Part 1.
Chapter 12 Solutions
Practical Business Math Procedures with Business Math Handbook
Ch. 12.1 - Complete the following without a table (round each...Ch. 12.1 - Prob. 2PQCh. 12.1 - Prob. 3PQCh. 12.1 - Prob. 4PQCh. 12.1 - Calculate by Table 12.2 what $1,500 compounded...Ch. 12.1 - Prob. 1EPQCh. 12.1 - Prob. 2EPQCh. 12.1 - Lionel Rodgers deposits $7,000 in Victory Bank,...Ch. 12.1 - Find the effective rate (APY) for the year:...Ch. 12.1 - Prob. 5EPQ
Ch. 12.1 - Prob. 1AHCh. 12.1 - Prob. 2AHCh. 12.1 - Prob. 3AHCh. 12.1 - Prob. 4AHCh. 12.1 - Prob. 5AHCh. 12.1 - Prob. 6AHCh. 12.1 - Prob. 7AHCh. 12.1 - Eileen Hogarty deposits $5,630 in City Bank, which...Ch. 12.1 - Prob. 9AHCh. 12.1 - Prob. 10AHCh. 12.1 - Prob. 11AHCh. 12.1 - Prob. 12AHCh. 12.1 - Prob. 13AHCh. 12.2 - Prob. 1PQCh. 12.2 - Prob. 2PQCh. 12.2 - Bill Blum needs $20,000 6 years from today to...Ch. 12.2 - Prob. 4PQCh. 12.2 - Prob. 1EPQCh. 12.2 - Prob. 2EPQCh. 12.2 - Prob. 3EPQCh. 12.2 - Prob. 4EPQCh. 12.2 - Prob. 1AHCh. 12.2 - Prob. 2AHCh. 12.2 - Prob. 3AHCh. 12.2 - Prob. 4AHCh. 12.2 - Prob. 5AHCh. 12.2 - Prob. 6AHCh. 12.2 - Prob. 7AHCh. 12.2 - Prob. 8AHCh. 12.2 - Prob. 9AHCh. 12.2 - Prob. 10AHCh. 12.2 - Prob. 11AHCh. 12.2 - Prob. 12AHCh. 12.2 - Prob. 13AHCh. 12.2 - Prob. 14AHCh. 12 - Prob. 1ECPCh. 12 - Prob. 2ECPCh. 12 - Prob. 3ECPCh. 12 - Prob. 4ECPCh. 12 - Calculate the effective rate (APY) of interest for...Ch. 12 - Prob. 6ECPCh. 12 - Prob. 7ECPCh. 12 - Prob. 8ECPCh. 12 - Prob. 9ECPCh. 12 - Prob. 10ECPCh. 12 - Prob. 11ECPCh. 12 - Prob. 12ECPCh. 12 - Lynn Ally, owner of a local Subway shop, loaned...Ch. 12 - Prob. 14ECPCh. 12 - Melvin Indecision has difficulty deciding whether...Ch. 12 - Prob. 16ECPCh. 12 - Lee Wills loaned Audrey Chin $16,000 to open Snip...Ch. 12 - Jazelle Momba wants to visit her family in...Ch. 12 - Prob. 19ECPCh. 12 - Prob. 20ECPCh. 12 - Prob. 21ECPCh. 12 - Prob. 22ECPCh. 12 - Prob. 23ECPCh. 12 - Prob. 24ECPCh. 12 - Prob. 25ECPCh. 12 - Prob. 26ECPCh. 12 - Prob. 27ECPCh. 12 - Earl Ezekiel wants to retire in San Diego when he...Ch. 12 - Jackie Rich would like to buy a $26,995 Toyota...Ch. 12 - Treasure Mountain International School in Park...Ch. 12 - Pete’s Real Estate is currently valued at $65,000....Ch. 12 - You are the financial planner for Johnson...Ch. 12 - Lorna Ray, owner of a Starbucks franchise, loaned...Ch. 12 - Joe Beary wants to attend Riverside College. Eight...Ch. 12 - Shelley Katz deposited $30,000 in a savings...Ch. 12 - Earl Miller, owner of a Papa Gino’s franchise,...Ch. 12 - Minnie Rose deposited $16,000 in Street Bank at 6%...Ch. 12 - Lou Ling, owner of Lou’s Lube, estimates that he...Ch. 12 - Bernie Long wants to retire to California when she...Ch. 12 - Jim Jones deposited $19,000 in a savings account...
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