Calculate expected value and variance of the aggregate claim

Reference no: EM131001342

The frequency of accidents for automobile drivers over a certain period follows a Poisson distribution. Good drivers can expect to have on average one accident over that period, while bad drivers can expect to have two accidents. It is estimated that 80% of drivers are good and 20% are bad. If an accident occurs, the claim amount is exponentially distributed with a mean of 100. Calculate the expected value and variance of the aggregate claims over this period.

Reference no: EM131001342

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