A life insurance policy pays 1,000 upon the death of a policyholder provided that the policyholder survives at least one year but less than five years after purchasing the policy. Let X denote the number of years that a policyholder survives after purchasing the policy with the following probabilities: egin{tabular}{|c|c|} hline $x$ & $Pr(X < x)$ \ hline 1 & 0.05 \ 2 & 0.12 \ 3 & 0.21 \ 4 & 0.33 \ 5 & 0.48 \ hline end{tabular} Calculate the standard deviation of the payment made under this policy.
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From the table: - \( P(X \leq 1) = 0.05 \) - \( P(X \leq 2) = 0.12 \) - \( P(X \leq 3) = 0.21 \) - \( P(X \leq 4) = 0.33 \) - \( P(X \leq 5) = 0.48 \) Show more…
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