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Exercise

ABy Admin
May 07'23

Answer

Solution: C

The mean and standard deviation for the 2025 contributions are 2025(3125) = 6,328,125 and 45(250) = 11,250. By the central limit theorem, the total contributions are approximately normally distributed. The 90th percentile is the mean plus 1.282 standard deviations or 6,328,125 + 1.282(11,250) = 6,342,548.

Copyright 2023. The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.

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