An actuary is analyzing the lapse experience of his company's whole life product. The tabulated results are as follows: Age group % of whole life policyholders probability of lapsing < 20 8 % 5 % 20 – 29 13 % 5 % 30 – 39 21 % 4 % 40 – 49 29 % 4% 50 – 59 17 % 3 % 60 + 12 % 2% Since the age group 40-49 is the most profitable, what is the probability that a lapsed policy will belong to this cohort?
An actuary is analyzing the lapse experience of his company's whole life product. The tabulated results are as follows: Age group % of whole life policyholders probability of lapsing < 20 8 % 5 % 20 – 29 13 % 5 % 30 – 39 21 % 4 % 40 – 49 29 % 4% 50 – 59 17 % 3 % 60 + 12 % 2% Since the age group 40-49 is the most profitable, what is the probability that a lapsed policy will belong to this cohort?
Chapter9: Sequences, Probability And Counting Theory
Section9.7: Probability
Problem 1SE: What term is used to express the likelihood of an event occurring? Are there restrictions on its...
Related questions
Concept explainers
Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
Topic Video
Question
Transcribed Image Text:An actuary is analyzing the lapse experience of his company's whole life product. The tabulated results are as follows:
Age group % of whole life policyholders probability of lapsing
8 %
< 20
5 %
20 – 29
13 %
5 %
30 – 39
21 %
4 %
40 – 49
29 %
4 %
50 – 59
17 %
3 %
60 +
12 %
2 %
Since the age group 40-49 is the most profitable, what is the probability that a lapsed policy will belong to this cohort?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, statistics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Calculus For The Life Sciences
Calculus
ISBN:
9780321964038
Author:
GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Publisher:
Pearson Addison Wesley,
Calculus For The Life Sciences
Calculus
ISBN:
9780321964038
Author:
GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Publisher:
Pearson Addison Wesley,