Question

Jim is a 60-year-old Anglo male in reasonably good health. He wants to take out a $50,000 term (i.e., straight death benefit) life insurance policy until he is 65. The policy will expire on his 65th birthday.

The probability of death in a given year is provided. x = age 60 61 62 63 64 P(death at this age) 0.01045 0.01402 0.01633 0.01987 0.02206

Jim is applying to Big Rock Insurance Company for his term insurance policy.

(a) What is the probability that Jim will die in his 60th year? (Enter a number. Enter your answer to five decimal places.)

Using this probability and the $50,000 death benefit, what is the expected cost to Big Rock Insurance (in dollars)? (Enter a number. Round your answer to two decimal places.) $

(b) What is the expected cost to Big Rock Insurance for years

61

62

63

and 64 (in dollars)?

(For each answer, enter a number. Round your answers to two decimal places.)

What would be the total expected cost to Big Rock Insurance over the years 60 through 64 (in dollars, Enter a number. Round your answer to two decimal places.) $

(c) If Big Rock Insurance wants to make a profit of $700 above the expected total cost paid out for Jim's death, how much should it charge for the policy (in dollars)? (Enter a number. Round your answer to two decimal places.) $

(d) If Big Rock Insurance Company charges $5000 for the policy, how much profit does the company expect to make (in dollars)? (Enter a number. Round your answer to two decimal places.) $

Answer #1

a) probability that dies in 60 th year= | 0.01045 | |||

expected cost = 50000*0.01045= | 522.5 |

b) | |||

probability | expected cost | ||

P(61)=0.01402 | 50000*0.01402=701 | ||

P(62)=0.01633 | 50000*0.01633=816.5 | ||

P(63)=0.01987 | 50000*0.01987=993.5 | ||

P(64)=0.02206 | 50000*0.02206=1103 | ||

total expected cost = | 4136.5 |

c) | |||||

total premium charged=proft+expected cost =4136.5+700= | 4836.5 |

d) | |||||

Profit =premium charged-expected cost=5000-4136.5= | 863.5 |

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided.
x =
age
60
61
62
63
64
P(death
at this age)
0.01069
0.01408
0.01618
0.02029
0.02296
Jim is applying to Big Rock Insurance Company for his term
insurance policy.
(a)
What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided.
x =
age
60
61
62
63
64
P(death
at this age)
0.01081
0.01393
0.01774
0.02014
0.02323
Jim is applying to Big Rock Insurance Company for his term
insurance policy.
(a) What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided.
x = age
60
61
62
63
64
P(death at this
age)
0.01009
0.01426
0.01681
0.02059
0.02254
Jim is applying to Big Rock Insurance Company for his term
insurance policy.
(a) What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided. x = age 60 61 62 63 64 P(death at this age) 0.01165
0.01429 0.01759 0.01939 0.02314 Jim is applying to Big Rock
Insurance Company for his term insurance policy. (a) What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition). x = age 60 61 62 63 64 P(death at
this age) 0.01165 0.01321 0.01750 0.01900 0.02356...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of
the United States (116th Edition).
x = age
60
61
62
63
64
P(death at this
age)
0.01105
0.01378
0.01747
0.01915
0.02269...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition).
x = age: 60, 61, 62, 63, 64
P(death at this age): 0.01105, 0.01390, 0.01765, 0.01945,
0.02365...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition). x = age 60 61 62 63 64 P(death at
this age) 0.01036 0.01480 0.01600 0.02032 0.02230...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of
the United States (116th Edition).
60
61
62
63
64
0.01030
0.01426
0.01687
0.02074
0.02221
(a) What is the probability that Jim...

can you please work on this assignment because I am having some
issues with it. I have it completed I would just like to know if
everything is correct.
DISCRETE PROBABILITY DISTRIBUTIONS
(3 points) The number of hits on a certain
website follows a Poisson distribution with a mean rate of 4 per
minute.
What is the probability that 5 messages are received in a given
minute? 0.1563
What is the probability that 9 messages are received in 1.5
minutes?...

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