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An insurance policy sells for $600. Based on past data, an average of 1 in 125 policyholders will file a $20,000 claim,
Posted: Thu Jul 14, 2022 3:56 pm
by answerhappygod
- An Insurance Policy Sells For 600 Based On Past Data An Average Of 1 In 125 Policyholders Will File A 20 000 Claim 1 (19.08 KiB) Viewed 27 times
An insurance policy sells for $600. Based on past data, an average of 1 in 125 policyholders will file a $20,000 claim, an average of 1 in 250 policyholders will file a $30,000 claim, and an average of 1 in 400 policyholders will file an $80,000claim. Find the expected value (to the company) per policy sold. If the company sells 20,000 policies, what is the expected profit or loss? The expected value is $ (Simplify your answer.)