SOA Exam P Sample Question 254
Study guide: Exam P-1
An actuary is studying hurricane models. A year is classified as high, medium, or low hurricane year with probabilities 0.1, 0.3, and 0.6 respectively. The numbers of hurricanes in high, medium, and low years follow Poisson distributions with means 20, 15, and 10 respectively.
Calculate the variance of the number of hurricanes in a randomly selected year.
- A) 11.25
- B) 12.50
- C) 12.94
- D) 13.42
- E) 23.75
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