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A 25-year-old man in the U.S. has a 0.141% risk of dying during the next year. An insurance company charges $260 per year for a life-insurance policy that pays a $100,000 death benefit. a) What is the expected value for the customer buying the insurance? b) What is the expected value for the insurance company? Round your answers to the nearest cent if necessary. Be careful with negative signs. Expected Value for Customer: $ Expected Value (or expected profit on one customer) for the Insurance company: for the year Question Help: Video Submit Question for the year

A 25-year-old man in the U.S. has a 0.141% risk of dying during the next year. An insurance company charges $260 per year for a life-insurance policy that pays a $100,000 death benefit. a) What is the expected value for the customer buying the insurance? b) What is the expected value for the insurance company? Round your answers to the nearest cent if necessary. Be careful with negative signs. Expected Value for Customer: $ Expected Value (or expected profit on one customer) for the Insurance company: for the year Question Help: Video Submit Question for the year

Calculus For The Life Sciences
Calculus For The Life Sciences
2nd Edition
ISBN:9780321964038
Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Publisher:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Chapter2: Exponential, Logarithmic, And Trigonometric Functions
Section2.3: Applications: Growth And Decay
Problem 16E
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A 25-year-old man in the U.S. has a 0.141% risk of dying during the next year. An insurance company charges $260 per year for a life-insurance policy that pays a $100,000 death benefit. a) What is the expected value for the customer buying the insurance? b) What is the expected value for the insurance company? Round your answers to the nearest cent if necessary. Be careful with negative signs. Expected Value for Customer: $ for the year Expected Value (or expected profit on one customer) for the Insurance company: $ for the year Question Help: Video Submit Question
Transcribed Image Text:A 25-year-old man in the U.S. has a 0.141% risk of dying during the next year. An insurance company charges $260 per year for a life-insurance policy that pays a $100,000 death benefit. a) What is the expected value for the customer buying the insurance? b) What is the expected value for the insurance company? Round your answers to the nearest cent if necessary. Be careful with negative signs. Expected Value for Customer: $ for the year Expected Value (or expected profit on one customer) for the Insurance company: $ for the year Question Help: Video Submit Question
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