Multiple Choice
An insurance company offers a life policy to individuals in a certain group.For a given 1-year period,the company will pay $5000 in the event of the death of a policyholder.If the probability that a person in this group dies during a 1-year time period is 0.001 and the annual premium for the policy is $10,then the expected gain per policy to the company is
A) $4.99.
B) $5.00.
C) $9.90.
D) $4990.
E) $4994.99.
Correct Answer:
Verified
Correct Answer:
Verified
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