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MA473 S10 Test 1

MA473 S10 Test 1 - 1 A participant in a pension plan is...

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1. A participant in a pension plan is subject to three decrements: (1) is retirement, (2) is death, (3) is other termination. All terminations have a constant force of decrement as follows: i. = 0.09 ii. = 0.01 iii. = 0.15 Calculate the following items: i. ii. iii. iv.
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2. One thousand whole life policies are issued to males (20). The policies are subject to two decrements - Mortality (1) and Lapse (2). You are given the following table: x 20 1000 20 180 21 800 40 80 22 680 34 36 23 610 40 30 Calculate the following items: i. ii. assuming that each decrement is uniformly distributed in the double decrement table. iii. assuming that each decrement is uniformly distributed in the associated single decrement table.
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3. A whole life policy pays a death benefit of 50,000 upon death. It pays an additional death benefit of 25,000 (over and above the 50,000 death benefit) upon death from an accident. You are given: i. δ = .08 ii. where (1) is death from an accident. iii. where (2) is death from any cause other than an accident. iv. Death Benefits are payable at time of death. Calculate the single benefit premium.
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4. Lu Life Insurance Company sells a fully discrete whole life policy with a benefit of 50,000 to (20). The policy has level annual premiums. You are given the following assumptions: i. Mortality follows the mortality in the Illustrative Life Table. ii. Interest is 6% per annum. iii. Expenses are as follows: 1. Per policy expenses at the beginning of each year of 200 in the first year and 50 per policy for each year thereafter; 2.
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