Exam Thoughts
Richard Sieger ( 110320.3071@compuserve.com )
Mon, 11 May 1998 14:08:10 -0400
I used the formula for Underwriting Profit ((1/(1-tu) x [ r x (QSR/PSR) -=
i
AFIT x (PHSF + 1/PSR)], and solved it as a factor of r, then left it in t=
he
form of ROE =3D Underwring profit divided by that factor (I don't remembe=
r
the exact factor offhand. I did not receive my exam booklet yet). I hope =
I
get partial credit for this.
I tried playing with the extraneous information (incurred losses, fixed a=
nd
variable expenses) and use the formula (P+F)/(1-V-Q) and solve for Q as t=
he
underwriting profit, but there was no rate to compare it to. So I left it=
=2E
Anyone else do the same?