Actuarial Notes

SOA Exam P Sample Question 44

Study guide: Exam P-1

A device that continuously measures and records seismic activity is placed in a remote region. The time, T, to failure of this device is exponentially distributed with mean 3 years. Since the device will not be monitored during its first two years of service, the time to discovery of its failure is X = \max(T, 2).

Calculate E[X].

  • A) 2 + \frac{1}{3}e^{-6}
  • B) 2 - 2e^{-2/3} + 5e^{-4/3}
  • C) 3
  • D) 2 + 3e^{-2/3}
  • E) 5

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