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Name2 Name2
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3 years ago
A home insurance company anticipates the following pattern of claims, based on historical data. What is the expected claim on the next policy sold by the company?

Type of ClaimSize of ClaimNumber of Claims out of 
10,000 Policy Holders		Probability
1$200,00010.0001
2$50,000100.001
3$2,0002000.02
4$09,7890.9789


▸ $100

▸ $110

▸ $120

▸ $130

▸ $140
Textbook 
Corporate Finance Online

Corporate Finance Online


Edition: 2nd
Authors:
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jamesbovejamesbove
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3 years ago
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#2
3 years ago
Really appreciate this, Thank you!
Anonymous
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A year ago
Help! The answer is missing an explanation...
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#4
A year ago
Done! Upwards Arrow
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