EXPECTED VALUE FOR LIFE INSURANCE. There is a 0.9986probability that a randomly

Question

EXPECTED VALUE FOR LIFE INSURANCE. There is a 0.9986probability that a randomly selected male lives through the year. Afidelity insurance company charges $161 for insuring that the malewill live through the year. If the male does not survive the year,the policy pays $1000,000 as a death benefit. a. from the perspective of the 30 year old male, what are thevalues corresponding to the two events of surviving the year andnot surviving. b.if a 30-year-old male purchases the policy, what is hsiexpected value? EXPECTED VALUE FOR LIFE INSURANCE. There is a 0.9986probability that a randomly selected male lives through the year. Afidelity insurance company charges $161 for insuring that the malewill live through the year. If the male does not survive the year,the policy pays $1000,000 as a death benefit. a. from the perspective of the 30 year old male, what are thevalues corresponding to the two events of surviving the year andnot surviving. b.if a 30-year-old male purchases the policy, what is hsiexpected value?

Explanation / Answer

is that 1,000,000 or 100,000 and for b is that expected value for one year or his lifetime?

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