2. [24 marks] Let Zi represent the PVRV for the ith contract below, for i = 1, 2, 3. For a life (30), consider the following (continuous) insurance contracts: (i) (ii) (iii) $5,000 Whole Life Insurance $5,000 Ten-Year Term Insurance $5,000 Ten-Year Endowment Insurance Mortality and Interest Assumptions: Illustrative Life Table with i = 6% Fractional Age Assumption: UDD a. Calculate the EPV of the benefits for each of the above contracts. [9 marks] b. Calculate Var(Zi) for each of the above contracts. Compare and rank the values. Do these ranks make sense? Explain. [15 marks] Notes: Take care with the fractional age assumption when calculating the variances. 2. [24 marks] Let Zi represent the PVRV for the ith contract below, for i = 1, 2, 3. For a life (30), consider the following (continuous) insurance contracts: (i) (ii) (iii) $5,000 Whole Life Insurance $5,000 Ten-Year Term Insurance $5,000 Ten-Year Endowment Insurance Mortality and Interest Assumptions: Illustrative Life Table with i = 6% Fractional Age Assumption: UDD a. Calculate the EPV of the benefits for each of the above contracts. [9 marks] b. Calculate Var(Zi) for each of the above contracts. Compare and rank the values. Do these ranks make sense? Explain. [15 marks] Notes: Take care with the fractional age assumption when calculating the variances