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Question: andnbspplease help me work this out on word document no...

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*PLEASE HELP ME WORK THIS OUT ON WORD DOCUMENT, NO HAND WRITTEN OR SYMBOLS**

ACME insurance company is looking to at its historical claims for a particular type of policy. In the past, payouts and their probability of occurring are given by:

 *PLEASE HELP ME WORK THIS OUT ON WORD DOCUMENT, NO HAND WRITTEN OR SYMBOLS**

Payout

Probability

0

0.82

500

0.03

1000

0.05

3000

0.04

5000

0.03

10000

0.02

15000

0.01

 

a.  A)What is the minimum amount ACME has to charge customers in order to ensure that they break even.

 

 *PLEASE HELP ME WORK THIS OUT ON WORD DOCUMENT, NO HAND WRITTEN OR SYMBOLS**

 

b.B) What is the standard deviation of the payout. Does it have any meaning here, and what does it imply about the riskiness of insurance?

 

 *PLEASE HELP ME WORK THIS OUT ON WORD DOCUMENT, NO HAND WRITTEN OR SYMBOLS**

 

 

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