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Ruby
02-09-2005, 07:43 AM
Lange, Text Page 169, first 5 lines. I just want to clarify the meaning of these lines. They are driving me nuts!

Lines1-2:
(1st expression on page 168) + (2nd expression on page 168) =
Increased limits losses after the application of trend

Lines2-4:
(Increased limits losses after the application of trend calculated above)/(1st expression on page 168) = Increased limits trend factor

OR Lines 2-4:
(2nd expression on page 168)/ (1st expression on page 168)= Increased limits trend factor

Which of the above(if any) are correct interpretations of first 5 lines on page 169 of Lange?

BassFreq
02-09-2005, 11:08 AM
(Increased limits losses after the application of trend)/(Increased limits losses before the application of trend) = (2nd expression on page 168)/ (1st expression on page 168)= Increased limits trend factor

Ruby
02-09-2005, 04:17 PM
Thanks BassFreq for your helpful reply. If you’ve All10, I would like to point-out a relevant thing there.

All10 Page 317, Expression b) for “Inflation Adjusted Increased limits losses”:
Is this expression correct? Its not given in Text at all. Further “N” is multiplied with the 1st piece of expression only or it’s again one of those All10’s darn typos?

Thanks

Super Silver Haze
02-09-2005, 05:14 PM
Thanks BassFreq for your helpful reply. If you’ve All10, I would like to point-out a relevant thing there.

All10 Page 317, Expression b) for “Inflation Adjusted Increased limits losses”:
Is this expression correct? Its not given in Text at all. Further “N” is multiplied with the 1st piece of expression only or it’s again one of those All10’s darn typos?

Thanks

If you're talking about what I think you're talking about (I have an older All10, so the page numbers are different), then no, it's not correct. It should be the expression shown at the bottom of Lange p. 168.

Ruby
02-09-2005, 06:36 PM
Ok, let me rephrase my question:

There are 2 expressions in paper (page168) while 3 expressions in All10 (2 same as paper Plus 1 additional not in paper). My question is whether the additional expression given in All10 is a correct one or not? Its probably calculated by All10’s Authors using the 2 expressions mentioned in paper and I find it suspicious since N is multiplied by only first item, not the whole expression.

I’ve checked both 2003 & 2000 versions of All10. Both have the additional expression that I’m talking about but the limits have been changed in 2003 version of All10 for this additional expression.

Super Silver Haze
02-09-2005, 09:03 PM
Okay okay okay. I'm with you now, I think.

You're right. The square closing bracket should be at the end of that expression, so yes, the N should be multiplying the whole expression. Also, the limits on the integrals should be going from k/(1+a) to infinity. That might be what's in the 2003 All10 already, I'm not sure.

This expression comes from what Lange is suggesting in the first sentence on p. 169, "Combining this expression with the previous one [i.e. the two expressions from p. 168] yields the increased limits losses after the application of the trend."

It's like you combine
the integrals going from k to infinity
with the integrals going from k/(1+a) to k
to get the integrals going from k/(1+a) to infinity.

Ruby
02-10-2005, 11:22 AM
Also, the limits on the integrals should be going from k/(1+a) to infinity. That might be what's in the 2003 All10 already, I'm not sure.

In 2003 All10's version, for 3rd expression, The limit of first integral is 0 to k/(1+a) while for later integral the limit is from k/(1+a) to infinity.

This expression comes from what Lange is suggesting in the first sentence on p. 169, "Combining this expression with the previous one [i.e. the two expressions from p. 168] yields the increased limits losses after the application of the trend."

That’s what I’ve been asking! It means that the 3rd expression divided by 1st expression at page 168 of text = increased limits trend factor? (Check my original message for 1st interpretation of lines 2-4)

How about BassFreq’s reply (Check my original message for 2nd interpretation of lines2-4)?

So it has again boiled down to the 2 interpretations of lines 2-4?…sigh!

jk
02-13-2005, 08:11 PM
Lange, Text Page 169, first 5 lines. I just want to clarify the meaning of these lines. They are driving me nuts!

Lines1-2:
(1st expression on page 168) + (2nd expression on page 168) =
Increased limits losses after the application of trendNot quite. Notice the sentence after the first expression: "If losses increase by "a" percent, not only is the first term multiplied by (1+a) with no increase in the negative second term . . ."

So mentally, make that adjustment to the first expression. Multiply the first integral by (1+a). Call this the "adjusted first expression".

Now, the adjusted first expression plus the second expression equals increased limits layer losses after the application of trend.

Lines2-4:
(Increased limits losses after the application of trend calculated above)/(1st expression on page 168) = Increased limits trend factorCorrect--now that you have the correct formula for for IL losses after the application of trend.