A person has a 0.16% chance of dying in the next year. A life insurance policy with a $50,000 death benefit costs him $125. What is the expected value of the insurance for the person? a) -$45 b) $45 c) -$117 d) $117

College Algebra
10th Edition
ISBN:9781337282291
Author:Ron Larson
Publisher:Ron Larson
Chapter8: Sequences, Series,and Probability
Section: Chapter Questions
Problem 41CT: On a game show, a contestant is given the digits 3, 4, and 5 to arrange in the proper order to form...
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A person has a 0.16% chance of dying in the next year. A life insurance policy with a $50,000
death benefit costs him $125. What is the expected value of the insurance for the person?
a) -$45
b) $45
c) -$117
d) $117
Transcribed Image Text:A person has a 0.16% chance of dying in the next year. A life insurance policy with a $50,000 death benefit costs him $125. What is the expected value of the insurance for the person? a) -$45 b) $45 c) -$117 d) $117
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