Math Problem Solver

An insurance company starts with an initial surplus of u = 5,000 dollars. Premiums are

received at a constant rate of c = 3,000 dollars per month. Claims arrive as a Poisson process

with a rate of λ = 1 claim per month, and each claim has an exponential distribution with a mean

of 2,000 dollars. Using the Lundberg inequality, calculate an upper bound for the probability of

ultimate ruin.