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Joshua0317
September 29th 2011, 01:27 PM
Can anyone help me understand the solution to #122 in the question and answer bank from the syllabus?

It deals with simulating number of claims. In the solution they compare the uniform (0,1) generated number to a range. The top end of the range is the from the cumulative distribution function. The bottom end of the range is from the probability mass function. I have only ever seen simulation with the Cumulative distribution function.

Anyone have any idea what they are doing, and if so, can you key me in to where this method is in the material? Or is the solution messed up?

Thanks,
Josh

Joshua0317
September 29th 2011, 02:16 PM
I'm starting to think maybe the manual is wrong in a few places. I found another wierd thing with question 125. The question refers to total losses, but the solution assumes a 2 year time period for some reason. Or am I reading this one incorrectly?