An automobile insurance company estimates the following loss probabilities for the next year on a $25,000sports car: $$\begin{array} { l r }
\text { Total loss: } & 0.001 \
50 \% \text { loss: } & 0.01 \
25 \% \text { loss: } & 0.05 \
10 \% \text { loss: } & 0.10
\end{array}$$ Assuming the company will sell only a $500 deductible policy for this model (i.e., the owner covers the first$500 damage), how much annual premium should the company charge in order to average $325 profit perpolicy sold?

Question

An automobile insurance company estimates the following loss probabilities for the next year on a $25,000sports car: $$\begin{array} { l r } 
\text { Total loss: } & 0.001 \
50 \% \text { loss: } & 0.01 \
25 \% \text { loss: } & 0.05 \
10 \% \text { loss: } & 0.10
\end{array}$$ Assuming the company will sell only a $500 deductible policy for this model (i.e., the owner covers the first$500 damage), how much annual premium should the company charge in order to average $325 profit perpolicy sold?

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The Answer of An automobile insurance company estimates the following loss probabilities for the next year on a $25,000sports car: $$\begin{array} { l r } 
\text { Total loss: } & 0.001 \
50 \% \text { loss: } & 0.01 \
25 \% \text { loss: } & 0.05 \
10 \% \text { loss: } & 0.10
\end{array}$$ Assuming the company will sell only a $500 deductible policy for this model (i.e., the owner covers the first$500 damage), how much annual premium should the company charge in order to average $325 profit perpolicy sold?

An Automobile Insurance Company Estimates the Following Loss Probabilities for the Next