A.) Calculate the average amount insured per client for both insurance companies

Question

A.) Calculate the average amount insured per client for both insurance companies?
B.) Describe the relationship between the 2 averages calculated in part A. Provide a reason for the disparity
C.) Would the two averages be considered parameters or statistics?

Homework: Homework Chapter 3 ah steele 4 903 AM Score: 0 of 10 pts 5 of 8 (1 complete) v HW Score: 2.5%, 2.5 of 100 pts in 2008, an insurance company insured 8.130 clients tor a total of s6.057.000,000. In 2004, a second insurance campany insured nearly 7,000 cients for total of s656,000000 a. Calculate the average amou insured per clien or both a insurance companies Question Help b. Describe the relationship between the two averages calculated in part a Provide a reason for the dispanty. C. Would the two averages be considered parameters or statistics? a The first insurance company insured an average of s perchent and the second insurance company insured an average of s perchent (Round to the nearest dollar as needed Enter your answer in the edit fields and then clock Check Answer 3 remaining Clear Al

Explanation / Answer

(A)

Average amount insured per client for first company: 6057000000/8130 = 745018.5

Average amount insured per client for second company: 656000000/7000 = 93714.29

(B)

The 2 averages describe the Average amount insured per client for the 2 companies. The disparity in the averages is due to the fact that the 2nd company data was from the year 2004 whereas the first company data was from year 2008. The 4 years gap might have lead to certain changes(increase) in the amount insured per client.

(C)

The 2 averages is considered as a parameter because it gives the information of the entire insured people by the 2 companies and thus is the information of a population. In general, a parameter refers to a number that summarises the entire population and a statistic is said for a number that summarises the sample. Here since total insured people average is considered (and not a sample), oth these averages are parameters.

Thus the first insurance company insured an average of $745019 per client and the second insurance company insured an average of $93714.

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