Question

An insurance company needs to determine the annual premium required to break even on fire protection policies with a face value of 90,000. If x is the claim size on these policies and the analysis is restricted to the losses 30,000, 50,000, and 90,000, then the probability distribution of x is as shown in the table. What premium should customers be charged for the company to break even? Round your answer to the nearest dollar.
030,00050,00090,000
0.99100.00360.00090.0045
A) 553
B) 24
C) 42,500
D) 558
E) 62,000

Answer

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