SOA Exam P Sample Question 225
Study guide: Exam P-1
The loss L due to a boat accident is exponentially distributed.
Boat insurance policy A covers up to 1 unit for each loss. Boat insurance policy B covers up to 2 units for each loss.
The probability that a loss is fully covered under policy B is 1.9 times the probability that it is fully covered under policy A.
Calculate the variance of L.
- A) 0.1
- B) 0.4
- C) 2.4
- D) 9.5
- E) 90.1
Answer this question and see the worked solution