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Unformatted text preview: . 05 t ] (ii) = 0.01 (iii) = 0.06 (a) Calculate the actuarial present value of this insurance. (500) (b) Calculate the variance of Z . (83,333.33) 4. Let Z be the present value random variable for a continuous 20year term insurance of 1 on (40). Assume mortality follows de Moivres Law with limiting age 100, and = 0.05. Show that the cdf of Z , F Z ( z ), is such that: F Z ( z ) = 0 for z < = 2 3 for 0 z < e1 = 1 + ln( z ) 3 for e1 z < 1 = 1 for z 1...
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This note was uploaded on 02/14/2011 for the course MATH 471 taught by Professor Staff during the Spring '08 term at University of Illinois, Urbana Champaign.
 Spring '08
 Staff
 Math

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