I need help on this multiple choices question. 1. Let X be the damage incurred (

Question

I need help on this multiple choices question.

1. Let X be the damage incurred (in $) in a certain type of accident during a given year. The pmf for X is given below:

a) E(X)=

     A. 700

     B. 0

     C. 1000

     D. 0.8

   E. 0.044

b) V(X)=

      A. 489,954

      B. 3,610,000

      C. 1,900

      D. 4,590,000

      E. 4,100,000

c) An insurance company offers a $500 deductible for this type of accident. If the company wishes it’s expected profit to be $100, what premium should it charge? Hint: Define a new R.V. for the amount of profit or loss the company will experience after the deductible. The deductible is the amount paid by the insurance company.

      A. $1000

      B. $600

      C. $100

      D. $700

      E. $300

Thank you,

Explanation / Answer

I need help on this multiple choices question. 1. Let X be the damage incurred (

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