Find the variance of the present value of the benefits

Reference no: EM131001629

You are given that qx = 0.1, qx+1 = 0.2, qy = 0.2, qy+1 = 0.3, and the rate of interest is a constant 25%. Find the variance of the present value of the benefits in each of the following contracts

(a) A payment of 100 is made at the end of the year of the second death, provided this occurs within 2 years.

(b) Three annual payments of 100 are made, the first at time 0, provided that at least one of (x) or (y) are alive.

Reference no: EM131001629

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