Exam P Practice Problem 30 – Mean and Variance of Total Loss

Practice Problem 30A

A property owner faces two random losses X and Y with the following joint density function:

      \displaystyle f(x,y)=\frac{3}{16} x^2 \ \ \ \ \ \ \ \ 0<x<2, \ 0<y<2

The property owner purchases an insurance policy to cover the total loss X+Y. This policy does not have a deductible. What is the expected payment to the property owner under this policy?

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Practice Problem 30B
Use the same information as in Problem 30A. What is the variance of the payment to the property owner under this policy?

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Answers

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