SOA Exam P Sample Question 84
Study guide: Exam P-1
You are given the following information about N, the annual number of claims for a randomly selected insured:
P(N=0) = \frac{1}{2}, \quad P(N=1) = \frac{1}{3}, \quad P(N>1) = \frac{1}{6}
Let S denote the total annual claim amount for an insured. When N=1, S is exponentially distributed with mean 5. When N>1, S is exponentially distributed with mean 8.
Calculate P(4 < S < 8).
- A) 0.04
- B) 0.08
- C) 0.12
- D) 0.24
- E) 0.25
Answer this question and see the worked solution