SOA Exam P Sample Question 34
Study guide: Exam P-1
A group insurance policy covers the medical claims of the employees of a small company. The value, V, of the claims made in one year is described by V = 100,000Y where Y is a random variable with density function
f(y) = \begin{cases} k(1-y)^4, & 0 < y < 1 \\ 0, & \text{otherwise} \end{cases}
where k is a constant.
Calculate the conditional probability that V exceeds 40,000, given that V exceeds 10,000.
- A) 0.08
- B) 0.13
- C) 0.17
- D) 0.20
- E) 0.51
Answer this question and see the worked solution