416 of 24 (L1 complete) This Quiz: 24 pts possi Queston Help Thereo s a 0 3343 a

Question

416 of 24 (L1 complete) This Quiz: 24 pts possi Queston Help Thereo s a 0 3343 arfasbilly that a andanmly selectiod 30 ynar-a ale lves throusgh te you A le ineanance company charge $195 torinrin tht the mal wllive troug the y trough the year til the male dxes nat suvive the yew, te policy pays ouit $110,000 as a death benefit Complete parts (a) twough (e) below a From the perspective of the 30-year dld male, what are the monetary values comemponding to the two everts of surviing the year and The value coresponding to surviving the year in t suving The value corresponding to not surviving the year is s (Type inters or decimals Do not rond ) b. the 30 year old male purchases the poicy, what is his espected value? The expected value Round to the nearest cent as rooded) c. Can the ireurance company expect to make a proft from many such policiens? Why? becaune the nsnce company spects to make an avenge prot of Son evy 30 yoar-colt1y Round to the nearest cent as needed) Enter your wnwerin each of he answrb 3 921 o

Explanation / Answer

a)

the value corresponding to surviving =-195

the value corresponding to not surviving =110000-195 =109805

b)

expected value =(1-0.9983)*110000-195= -8

c)

Yes because the ...profit is $8 on every 30 year old....

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