Question: (5 marks) Let S be an aggregate model, with a frequency distribution N and a severity distribution X. Assume that N is a Binomial distribution

(5 marks) Let S be an aggregate model, with a frequency distribution N and a severity distribution X. Assume that N is a Binomial distribution with parameters m=6 and p=, and X is a geometric distribution with parameter . It is known that P(S=0)=0.5 and P(S=1)=0.05. Determine the value of the parameters and . Hint: Use the probability generating function from the compound frequency distribution described in Ch. 7, Section 1

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