This preview has intentionally blurred sections. Sign up to view the full version.
View Full DocumentThis preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
Unformatted text preview: . 05 t ] (ii) μ = 0.01 (iii) δ = 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 Moivre’s Law with limiting age 100, and δ = 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...
View
Full Document
 Spring '08
 Staff
 Math, Actuarial Science, Normal Distribution, Variance, Probability theory, probability density function, Term life insurance

Click to edit the document details