Hello there! I will try my best to answer your question.
1) This is a problem about "estimated gain" from a total possible value X and take a percentage of "success rate" of Y% out of the X, the resulted value being how much we loss/gain out of an total amount X with the percentage Y.
Solution: $500,000 x 0.01 (Poss. of Loss) = $5,000 loss estimated from theft each year. However, the insurance company not only want to make it even, it wants to have its gain (revenue?) to be equal to $1,000. Then to cover the $5000 loss with $5000 premium out of the customer, you add another $1000 to make it your gain. Conclusion: the insurance company will try to charge $6000 as the insurance premium.
2) This is a more complicated version of #1.
Solution: the cost for delivery is $14.80, yet the company charges $15.50 to cover for possible delay, and to gain a revenue after all the cost / penalty are deducted.
$15.50 x (1-0.02) = what is left of the total revenue after the expected penalty for delay. Result $15.19.
Now that is what the company will gain from every delivery per day minus the penalty. Now we factor in the basic cost.
$15.19 being the modified "raw" revenue minus the $14.80 cost, we have $0.39. That is the expected gain per package (what the company will actually earn after all the cost / penalty).
Good luck with stat. Take Mr.Hoon Kim if you can. He is the best stat teacher we will ever have. |