Question

In order to set premiums at profitable levels, insurance companies must estimate how much they will have to pay in claims on cars of each make and model, based on the value of the car and how much damage it sustains in accidents. Let C be a random variable that represents the cost of a randomly selected car of one model to the insurance company. The probability distribution of C is given below. The probability that the insurance company will have to pay a claim of at least $1000 for a randomly selected car is:

Answer 1

The answer is "0.35"

Explanation:

Please find the complete question in the attached file.

In the given table the distributions of probabilities provided is a continuous spread for both the random variable c.

They need to have a cumulative chance of receiving claims of 4000 or higher to determine the probability of an insurance company ending let's give claims of at least 4000.

So, The right equation for the answer will then be
`0.13 + 0.22=0.35`