CAS Exam MAS-II Fall 2019, Question 4

Study guide: Exam MAS-II

You are given the following parameters.

• Assume the full-credibility standard using limited-fluctuation credibility is based on \alpha = 0.05 and k = 0.02.
• The expected claim frequency per exposure unit is 0.03.
• W is the full-credibility standard for claim frequency in exposure units assuming Poisson claim frequency.
• V is the full-credibility standard for claim frequency in exposure units assuming binomial claim frequency.

Calculate |W - V|.

• A) Less than 4,000
• B) At least 4,000 but less than 6,000
• C) At least 6,000 but less than 8,000
• D) At least 8,000 but less than 10,000
• E) At least 10,000

Answer this question and see the worked solution

Concepts tested

• Full Credibility Standard
• Limited Fluctuation Credibility
• Poisson Distribution
• Binomial Distribution

More questions from this set

• CAS Exam MAS-II Fall 2019, Question 3
• CAS Exam MAS-II Fall 2019, Question 5