SOLUTION: The probability that a car will not require service for a fixed length of time is 0.95. An insurance company will sell a $3000 comprehensive coverage policy for this length of time
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Question 1155261: The probability that a car will not require service for a fixed length of time is 0.95. An insurance company will sell a $3000 comprehensive coverage policy for this length of time for a premium of $300. Estimate the loss or profit for the insurance company ?
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
E(X)=0.95(300)-0.05*3000=285-150=$135 per policy.
it is x(p(x))-y(p(1-x))
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