Exam MAS-I Practice Question 152
Study guide: Exam MAS-I
A workers' compensation insurer grades each injury as minor (Y = 1), moderate (Y = 2), serious (Y = 3) or severe (Y = 4). It fits a proportional odds model
\ln\!\left(\frac{\gamma_j}{1 - \gamma_j}\right) = \theta_j + \beta_1 x_1 + \beta_2 x_2, \qquad \gamma_j = P(Y \le j), \quad j = 1, 2, 3,with these estimates:
| Parameter | Estimate |
|---|---|
\theta_1 |
-0.4 |
\theta_2 |
1.1 |
\theta_3 |
2.6 |
\beta_1 (attorney involved: x_1 = 1, otherwise 0) |
-0.9 |
\beta_2 (claimant age in decades: x_2 = \text{age}/10) |
-0.15 |
Consider a 40-year-old claimant who has an attorney.
Part a (1 point)
Calculate the probability that this claimant's injury is graded moderate (Y = 2). Give your answer to three decimal places.
Part b (1 point)
Calculate the probability that this claimant's injury is graded severe (Y = 4). Give your answer to three decimal places.
Answer this question and see the worked solution