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ABy Admin
Jun 01'22
Exercise
An insurer sells two types of policies. The claim frequency for a single coverage period for each type policy is given below:
Frequency | Type A | Type B |
---|---|---|
0 | 0.4 | 0.2 |
1 | 0.3 | 0.4 |
2 | 0.3 | 0.2 |
A type of policy is randomly selected with type A being three times as likely to be selected as type B. If a sample claim frequency equalling 2 is observed for the selected policy type, what is the probability that a new sample claim frequency is less than 2 for the selected policy type.
- 0.57
- 0.6
- 0.6563
- 0.6818
- 0.7