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Mathematics, 26.02.2021 07:20 MikeWrice4494
In order to set premiums at profitable levels, insurance companies must estimate how much they will have to pay in claims on cars of each make and model, based on the value of the car and how much damage it sustains in accidents. Let C be a random variable that represents the cost of a randomly selected car of one model to the insurance company. The probability distribution of C is given below.
C
$0
$500
$1000
$2000
P(C)
0.70
0.15
0.11
0.04
1. The expected value of C is =
2. The standard deviation of C is =
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Answers: 2
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