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ABy Admin
Jun 01'22

Exercise

Losses without deductible (full coverage) has a uniform distribution on [0,b]. When a deductible equal to rb is in effect, the payment variance is 0.75(1-r)2 times the payment variance without deductible. Determine which interval contains the value of r.

  • [0.55,0.6]
  • [0.68,0.73]
  • [0.75,0.79]
  • [0.82,0.85]
  • [0.9,0.95]
ABy Admin
Jun 01'22

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