Math Problem Solver

Suppose a life insurance company sells a ​$260,000 ​1-year term life insurance policy to a 20​-year-old female for ​$360. According to the National Vital Statistics​ Report, 58(21), the probability that the female survives the year is 0.999544. Compute and interpret the expected value of this policy to the insurance company.

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Part 1

The expected value is ​$  241.44.​(Round to the nearest cent as​ needed.)Part 2Which of the following interpretations of the expected value is​ correct? Select the correct choice below and fill in the answer box to complete your choice.​(Round to the nearest cent as​ needed.)A.The insurance company expects to make a minimum profit of ​$

  

enter your response here on every 20 dash year dash old female it insures for 1 month.

B.

The insurance company expects to make a maximum profit of ​$  enter your response here on every 20 dash year dash old female it insures for 1 year.C.The insurance company expects to make a profit of ​$

  

enter your response here on every 20 dash year dash old female it insures for 1 month.

D.

The insurance company expects to make a profit of ​$  enter your response here on every 20 dash year dash old female it insures for 1 year.