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Suppose you pay $500 per year to insure your car worth $10,000. The probability that you get in an accident, totaling the car, in any year is 0.001. Find your expected value of the insurance. Round your answer to the nearest dollar. Hint: if you get in the accident you will be paid $10,000. However, you already paid the $500, so you must use the net of $9,500.

Suppose you pay $500 per year to insure your car worth $10,000. The probability that you get in an accident, totaling the car, in any year is 0.001. Find your expected value of the insurance. Round your answer to the nearest dollar. Hint: if you get in the accident you will be paid $10,000. However, you already paid the $500, so you must use the net of $9,500.

Algebra & Trigonometry with Analytic Geometry
Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter10: Sequences, Series, And Probability
Section: Chapter Questions
Problem 35T
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Suppose you pay $500 per year to insure your car worth $10,000. The probability that you get in an accident, totaling the car, in any year is 0.001. Find your expected value of the insurance. Round your answer to the nearest dollar. Hint: if you get in the accident you will be paid $10,000. However, you already paid the $500, so you must use the net of $9,500.
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