Question: Q3) What is the output random variable? How is the output variable related to the input random variable and the decision variable? 00 c $

Q3) What is the output random variable? How is the output variable related to the input random variable and the decision variable?

00 c $ 6,000,000 1000 $ 5,000 $ 1,500 Minimum Ratum on Bonds Maximum Rotum on Bonds Cost of Borrowing 8% 10% Possible Amounts of Reserve Capital 1 Insurance Reserve Capital Problem 2 3 Total Capital 4 Expected Number of Claims 5 Mean Value of Claim 6 Standard Deviation of Value of Claim 7 8 Number of Claims 9 Mean Value of Sum of Claims 10 Standard Deviation of Sum of Claims 11 Sum of Claims 12 13 Reserve Capital 14 Value of Claims Covered from Reserve Capital 15 Amount to Borrow 16 Cost of Borrowing 17 18 19 20 $ 4.700.000 $4.800000 $ 4,900.000 $15.000.000 $ 5.100.000 Capital invested in Bonds Random Return on Bands Total Rotum from Investment Cash Loft

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