RE: Asset Share Exhibit 7&8

Budde, Paul ( (no email) )
Wed, 11 Feb 1998 11:07:42 -0600

Jeff -- I think you are correct in identifying this as a misprint. Note
that $142 would agree with Exhibit 3 (again, 17.8% of $800), while the
$88 seems to be a carry-over from exhibit 6.

Paul
E. W. Blanch
Minneapolis, MN

> -----Original Message-----
> From: jcourch@colognere.com [SMTP:jcourch@colognere.com]
> Sent: Wednesday, February 11, 1998 10:15 AM
> To: studygroup6@lists.casact.org
> Subject: Asset Share Exhibit 7&8
>
>
> Please verify possible typo regarding... Feldblum - Asset Share
> Pricing
>
> This number has a small (possibly trivial) effect on the exhibit as a
> whole. The expense
> calculations on these exhibits are confusing (and therefore highly
> testable), so I am
> interested to know if I am missing something.
>
> Exhibit 7 and 8 (Underwriting Cycle Effect)
> Col 6, Row 1 (Fixed expenses for new business)
> The Exhibit shows $88.
> First year premium is $800. (Col 1, Row 1)
> The footnote says first year fixed expenses are 17.8% of premium.
> 17.8% * 800 = $142
>
> Am I missing something, or should Col 6, Row 1 be $142, not $88 as
> printed.
>
> Thanks,
> Jeff
>