Idontunderstand
New member
- Joined
- Oct 27, 2011
- Messages
- 9
An insurance policy is written to cover a loss, X where x has a uniform distribution on [o,1000]. At what level must a deductible be set in order for the expected payment to be 25% of what it would be with no deductible?
I am given the formula Integrate [d, 1000] (X-d)*.001dx
I was wondering where the .001 came from? Is it the probability of being in that interval?
I am given the formula Integrate [d, 1000] (X-d)*.001dx
I was wondering where the .001 came from? Is it the probability of being in that interval?