You can insure a $50,000 diamond for its total value by paying a premium of D dollars.

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You can insure a $50,000 diamond for its total value by paying a premium of D dollars. If the probability of loss in a given year is estimated to be .01, what premium should the insurance company charge if it wants the expected gain to equal $1000?

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Introduction To Probability And Statistics

ISBN: 9781133103752

14th Edition

Authors: William Mendenhall, Robert Beaver, Barbara Beaver

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Question Posted: Apr 15, 2016 06:56 AM

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You can insure a $50,000 diamond for its total value by paying a premium of D dollars.

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The random variable G total gain to the insurance company will be D if there is no ...View the full answer

Introduction To Probability And Statistics

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