document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=764089>Question 764089</A>: <I><SPAN STYLE=\"word-break: break-all;\"> An insurance company charges a homeowner $895 a year for total loss coverage on a 325,000 policy. if the homeowner is only insured for total loss and there is a .00085 probability of such a loss,find the insurance company's expected value on the policy.\r<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #465182 by </B><A HREF=/tutors/aboutme.mpl?userid=stanbon><B>stanbon(75887)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=stanbon><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=465182\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> An insurance company charges a homeowner $895 a year for total loss coverage on a 325,000 policy. if the homeowner is only insured for total loss and there is a .00085 probability of such a loss,find the insurance company's expected value on the policy.<BR>\n" );
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document.write( "Random \"gain\" for the company: 895:::::: -324105<BR>\n" );
document.write( "Corresponding probabilities::: 0.9992:::  0.00085<BR>\n" );
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document.write( "Expected \"gain\" = 0.9992*895 -0.00085*324105 = $618.75<BR>\n" );
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document.write( "Cheers,<BR>\n" );
document.write( "Stan H.<BR>\n" );
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