The value corresponding to surviving the year is $ The value corresponding to not surviving the year is $ (b) If 32 year-old male purchases the policy, what is his expected value? The expected value is $ (Round to the nearest cent as needed.)
The value corresponding to surviving the year is $ The value corresponding to not surviving the year is $ (b) If 32 year-old male purchases the policy, what is his expected value? The expected value is $ (Round to the nearest cent as needed.)
Holt Mcdougal Larson Pre-algebra: Student Edition 2012
1st Edition
ISBN:9780547587776
Author:HOLT MCDOUGAL
Publisher:HOLT MCDOUGAL
Chapter11: Data Analysis And Probability
Section11.8: Probabilities Of Disjoint And Overlapping Events
Problem 2C
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There is a 0.9987 probability that a randomly selected 32 year-old male lives through the year. A
life insurance company charges $169 for insuring that the male will live through the year. If the
male does not survive the year, the policy pays out $110,000 as a death benefit.
(a) From the perspective of the 32 year old male, what are the monetary values corresponding to
the two events of surviving the year and not surviving?
The value corresponding to surviving the year is $
The value corresponding to not surviving the year is $
(b) If 32 year-old male purchases the policy, what is his expected value?
The expected value is $
(Round to the nearest cent as needed.)
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