Actuary Exam 1: 2 of 3 Questions & Answers 2023/2024
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Actuary
Actuary Exam 1: 2 of 3 Questions & Answers 2023/2024
What distribution would you use? Number of insurance claims during a given time period. - ANSWER-Poisson
What distribution would you use? Number of deaths per year from a given group of people. - ANSWER-Poisson
What distribution would ...
Actuary Exam 1: 2 of 3 Questions &
Answers 2023/2024
What distribution would you use? Number of insurance claims during a given time period. - ANSWER-
Poisson
What distribution would you use? Number of deaths per year from a given group of people. - ANSWER-
Poisson
What distribution would you use? Number of mail pieces recieved in a day? Or number of phone calls
recieved in a hour? - ANSWER-Poisson
What distribution would you use: Suppose on average that a web page gets 2 hits per minute. What is
the probability that you would have to wait at most 40 seconds for the next hit? - ANSWER-Exponential
What distribution would you use: Suppose on average that a web page gets 2 hits per minute. How long
do we have to wait at most, to observe a first hit with a probability of 0.9? - ANSWER-Exponential
What distribution would you use: How much time will elapse before an earthquake occurs in a given
region? - ANSWER-Exponential
What distribution would you use? How long do we need to wait before a customer enters our shop? -
ANSWER-Exponential
What distribution would you use? How long will a piece of machinery work without breaking down? -
ANSWER-Exponential
What distribution would you use? How long will it take before a call center receives the next phone call?
- ANSWER-Exponential
, What distribution would you use? The time elapsed between the arrival of a customer at a shop and the
arrival of the next customer has an exponential distribution with expected value equal to 15 minutes.
Furthermore, it is independent of previous arrivals. What is the probability that more than 6 customers
arrive at the shop during the next hour? - ANSWER-Poisson
What distribution would you use? At a call center, the time elapsed between the arrival of a phone call
and the arrival of the next phone call has an exponential distribution with expected value equal to 15
seconds. Furthermore, it is independent of previous arrivals. What is the probability that less than 50
phone calls arrive during the next 15 minutes? - ANSWER-Poisson
What distribution would you use: Calulate the size of loan defaults or aggregate insurance claims. -
ANSWER-Gamma
What distribution would you use? Bob is a high school basketball player. He is a 70% free throw shooter.
That means his probability of making a free throw is 0.70. During the season, what is the probability that
Bob makes his third free throw on his fifth shot? - ANSWER-Negative binomial
What distribtuion would you use: The prbability that a particular machine breaks down in any day is .20
and is independent of the breakdowns on any other day. The machine can break down only once per
day. Calculate the probability that the machine breaks down two or more times in ten days. - ANSWER-
Binomial
What distribution would you use: A company prices its hurricane insurance using the following
assumptions: 1. In any year, there can only be at most one hurricane. 2. Prob of hurricane in a given year
is .05. 3. Number of hurricanes in any year is independent of the number of hurricanes in any other year.
Calculate the probability that there are fewer than 3 hurricanes in a 20 year period. - ANSWER-Binomial
What distribution would you use: An insurance policy on an electrical device pays a benefit of 4000 if the
device fails during the first year. The amount of the benefit decreases by 1000 each successive year until
it reaches 0. If the device has not failed by the begining of any given year, the probability of failure during
that year is 0.4. What is the expected benefit under this policy? - ANSWER-Geometric
What distribution would you use: A tour operator has a bus that can accommodate 20 tourists. The
operator knows that tourists may not show up, so he sells 21 tickets. The probability that an individual
tourist will not show up is .02 independent of all other tourists. Each ticket is $50 non-refundable. If a
tourist shows up and there is not a seat the operator has to pay $100 to the tourist. What is the
expected revenue of the tour operator. - ANSWER-Binomial
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