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An Insurance Policy Costs $400,and Will Pay Policyholders $10,000 If

Question 4

Multiple Choice

An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy.


A)
An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy. A)    B)    C)    D)    E)
B)
An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy. A)    B)    C)    D)    E)
C)
An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy. A)    B)    C)    D)    E)
D)
An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy. A)    B)    C)    D)    E)
E)
An insurance policy costs $400,and will pay policyholders $10,000 if they suffer a major injury (resulting in hospitalization) ,or $2,000 if they suffer a minor injury (resulting in lost time from work) .The company estimates that each year 1 in every 3,000 policyholders may have a major injury,and 1 in 1,000 a minor injury.Create a probability model for the company's profit on this policy. A)    B)    C)    D)    E)

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