Question 1

Latent demand in a demand-response curve is the area obtained when? Which of the following distributions is/are Symmetric in nature (choose all that are applicable)? **(The following is a purely imaginary scenario)**\ An insurance company believes that people can be divided into two classes: “*Class-1: Those who are* *accident prone*” and “*Class-2: Those who are not accident prone*”. The company’s statistics show that an accident-prone person will have an accident at sometime within a fixed 1-year period with probability 0.4, whereas this probability decreases to 0.2 for a person who is not accident prone. It is assumed that 30 percent of the human population is accident prone. Given this information, answer the sub-questions. What is the probability that a new policyholder will have an accident within a year of purchasing a policy? *(Note: Enter the answer* <u>**rounded to two decimal places**</u>*. For example, if the answer is “1.235”,* **then enter it as “1.24”***)*