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Old 03-19-2014, 09:48 PM
Taberna1 Taberna1 is offline
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Default ASM 12ed 2nd printing - PE 5 Q 24.

Hello everybody,
I am confused on this question. Help would be greatly appreciated.

It is your typical gain by source question.
It asks to calculate the gain from mortality and expense given that it is analyzed in the order of mortality, interest, expense.

The gain from mortality is simple..
It is (Assumed - Actual mortality)( Death Benefit + Assumed Settlement Expense - EOY Reserve )

The gain from expense is tripping me up a little.

The solution has:
(Assumed - Actual Annual Expense)( 1 + Actual Interest) + Actual mortality* (Actual - Assumed Settlement Expense)

I always thought the "formula" for gain from expense was "Assumed - Actual for Settlement Expenses".

Could somebody clarify?
Thanks!
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Old 03-19-2014, 10:18 PM
Abraham Weishaus Abraham Weishaus is offline
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Did you check the errata?
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Old 03-19-2014, 10:58 PM
Taberna1 Taberna1 is offline
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Just did now. It's on there.
Thanks!
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