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  • Normal Distribution.

    I also have a question about Normal Distribution. I do understand how the normal distribution work and am very familiar with this section but the only thing throw me off is: when the values of the "r" to find the z-value is not in the z-table range. The SOA board already throw that kind of question once before in the exam, the only way you can do is to use "the Linear interpolation method" which breaks the value of "r" and bring it into the table range. Is anybody know how to use that method. the Question I am talking about is in (MAY 2001 EXAM Q#33).
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  • #2
    Originally posted by admin
    I also have a question about Normal Distribution. I do understand how the normal distribution work and am very familiar with this section but the only thing throw me off is: when the values of the "r" to find the z-value is not in the z-table range. The SOA board already throw that kind of question once before in the exam, the only way you can do is to use "the Linear interpolation method" which breaks the value of "r" and bring it into the table range. Is anybody know how to use that method. the Question I am talking about is in (MAY 2001 EXAM Q#33).
    I don't have the problem in front of me, but regarding Linear Interpolation:

    You can think of linear interpolation as connecting dots with straight lines. For example, let's say you have some function f(x). Let's say I told you that f(1) = 4, f(2) = 6, and asked you to find f(1.5) by linear interpolation. You would find the point that's halfway between 4 and 6 = 5. More generally, for x in [a,b],

    f(x) = ((x-a)/(b-a)) * f(b) + (1 - (x-a)/(b-a)) * f(a)

    Now, same situation, different value I'm asking for: find f(1.75) by linear interpolation.

    Then, you get f(1.75) = (0.75)(f(2)) + (0.25)(f(1)) = 5.5.

    Hope that helps.
    Last edited by wat; March 15 2005, 06:48 AM.

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