Actuarial Outpost SOA #222
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 Short-Term Actuarial Math Old Exam C Forum

#1
05-19-2018, 01:14 AM
 RockOn Member SOA Join Date: Dec 2013 Studying for Exam C Favorite beer: Polygamy Porter Posts: 80
SOA #222

Hello,
I'm hoping that someone can clarify the SOA's solution for this problem.

In the problem description it states that any group that has less than 5 for an expected value should be combined with another group.

For the 3+ group I combined this with the '2' group to get an expected value of 22.73.
When doing so my overall Chi Square statistic is: 5.76

The SOA's solution for this problem appears to not combine this last group.

Can anyone explain the apparent discrepancy in the problem wording and the SOA's solution?
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#2
05-19-2018, 02:32 AM
 Jim Daniel Member SOA Join Date: Jan 2002 Location: Davis, CA College: Wabash College B.A. 1962, Stanford Ph.D. 1965 Posts: 2,675

Quote:
 Originally Posted by RockOn Hello, I'm hoping that someone can clarify the SOA's solution for this problem. In the problem description it states that any group that has less than 5 for an expected value should be combined with another group. For the 3+ group I combined this with the '2' group to get an expected value of 22.73. When doing so my overall Chi Square statistic is: 5.76 The SOA's solution for this problem appears to not combine this last group. Can anyone explain the apparent discrepancy in the problem wording and the SOA's solution? Thank you for your help!
It says "less than one", not "less than five".
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#3
05-19-2018, 03:38 PM
 RockOn Member SOA Join Date: Dec 2013 Studying for Exam C Favorite beer: Polygamy Porter Posts: 80

Quote:
 Originally Posted by Jim Daniel It says "less than one", not "less than five".
Yes...you're right, it does. Thank you, I misread that.

In the ASM manual, I thought I read that it was standard to regroup an interval if the expecteds are less than 5? Should I work problems assuming that it's less than 5 unless otherwise noted?

RockOn
__________________
EXAMS: P | FM | MFE | MLC | STAM | PA |
VEE: ECON | STATS | CORP FINANCE |
FAP: MOD 1| MOD 2| MOD 3| MOD 4| MOD 5| IA| MOD 6| MOD 7| MOD 8| FA |