Actuarial Notes

SOA Exam P Sample Question 410

Study guide: Exam P-1

This year, a homeowner experiences no tornadoes with probability 0.80, exactly one tornado with probability 0.12, exactly two tornadoes with probability 0.05, and exactly three tornadoes with probability 0.03.

Each tornado independently results in a loss of 1 with probability 0.50 and a loss of 2 with probability 0.50.

Let X be the number of tornadoes that the homeowner experiences this year, and Y be the total amount of losses that the homeowner experiences this year due to all the tornadoes. Let F(x,y) be the joint cumulative distribution function of X and Y.

Calculate F(2,3).

  • A) 0.0250
  • B) 0.0500
  • C) 0.0675
  • D) 0.9325
  • E) 0.9575

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