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Mathematics, 12.03.2020 16:47 toricarter00

An individual who has automobile insurance from a certain company is randomly selected. Let Y be the number of moving violations for which the individual was cited during the last 3 years. The pmf of Y is the following.

y 0 1 2 3
p(y) 0.50 0.25 0.20 0.05

(a) Compute E(Y).
(b) Suppose an individual with Y violations incurs a surcharge of $100Y2. Calculate the expected amount of the surcharge.

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