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#1
03-19-2014, 09:48 PM
 Taberna1 Member SOA Join Date: Aug 2011 College: UofI Posts: 94
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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#2
03-19-2014, 10:18 PM
 Abraham Weishaus Member SOA AAA Join Date: Oct 2001 Posts: 7,254

Did you check the errata?
#3
03-19-2014, 10:58 PM
 Taberna1 Member SOA Join Date: Aug 2011 College: UofI Posts: 94

Just did now. It's on there.
Thanks!
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