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Exercise
May 06'23
Answer
Solution: C
The probability that a single claim is less than 25 is
[[math]]
\operatorname{P}( X \leq 25) = \int_{10}^{25} 10x^{-2} dx = 3/5.
[[/math]]
The probability that all three claims are less than 25 is (3 / 5)3 = 27 /125.
Copyright 2023. The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.