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THE UNIVERSITY OF NEW SOUTH WALES

SCHOOL OF RISK AND ACTUARIAL STUDIES
MONTH OF EXAMINATION APRIL 2012
MID SESSION EXAMINATION
ACTL3001
ACTL5104
ACTUARIAL STATISTICS
1) TIME ALLOWED 50 Minutes including reading time
2) TOTAL NUMBER OF QUESTIONS 3.
3) TOTAL MARKS AVAILABLE 30
4) THE MARKS ALLOCATED TO EACH PART OF EACH QUESTION ARE
INDICATED.
5) THIS EXAMINATION PAPER HAS 10 PAGES
6) ANSWER ALL QUESTIONS ON THIS QUESTION SHEET
7) THIS PAPER MAY NOT BE RETAINED BY THE CANDIDATE
8) ALL QUESTIONS ARE NOT OF EQUAL VALUE
9) CANDIDATES MAY BRING THEIR OWN CALCULATOR AND TABLES
FOR EXAMINATION PURPOSES
10) ALL ANSWERS MUST BE WRITTEN IN INK. ILLEGIBLE ANSWERS WILL
NOT BE MARKED.

Formulas and tables:

Table of Chi-square statistics
Df P = 0.05 P = 0.01 P = 0.001
1

3.84

6.64

10.83

11.07

15.09

20.52

10 18.31

23.21

29.59

20 31.41

37.57

45.32

30 43.77

50.89

59.70

40 55.76

63.69

73.41

50 67.51

76.15

86.66

100 124.34 135.81 149.48

Page 2 of 10

Question 1 [4 marks]
A survival function is given by

!"!! = exp (10!! 1.1! ) , 0 30

Find each of the following:

i)
ii)
iii)

35
15p30
15|10q30

Page 3 of 10

Question 2 [22 marks]

A large funeral society in developing country has investigated its mortality over the
past two calendar years and produced the following results.
Age

Actual

Expected

20
21
22
23
24

2
3
6
10
16

2
4
5
10
10

25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49

23
24
29
27
35
32
46
31
43
25
39
41
62
60
84
44
89
75
65
68
99
123
126
127
179

20
19
20
22
25
28
34
28
42
27
36
45
58
64
73
55
83
70
64
81
88
117
130
126
150

50
51
52
53
54
55
56
57
58
59
60

91
146
177
154
137
207
146
181
201
136
214

103
131
186
141
146
210
149
164
217
140
206

Page 4 of 10

Chi squared
0.02
0.17
0.18
0.01
4.28
0.34
1.32
3.35
1.08
4.67
0.59
4.20
0.17
0.01
0.23
0.19
0.52
0.31
0.24
1.82
2.04
0.52
0.36
0.01
1.93
1.32
0.35
0.10
0.02
5.34
1.37
1.72
0.44
1.10
0.58
0.03
0.06
1.93
1.08
0.10
0.31

Question 2 continued
Some useful results:
Standardised deviations:
Less than -2
Less than -1
Less than 0
Less than 1
Less than 2
More than 2
Grouping of signs
Positive
Negative
Chi squared
Cumulative deviations
Total deaths

1000

0
6
12
11
8
4
Number
25
16
Total
44
-115
3329

Groups
12
11
First 21
26
-55
627

Second 20
18
-39
2702

Actual vs expected deaths

100

10
Actual
Expected
1
20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60

You have been told that all the calculations except the last table have been checked
for accuracy.

Page 5 of 10

Question 2 continued
a)
If the rate interval used in collecting the data was a life year, and the society
has records of the age at death of each member, what records would it have had to
keep for determining the exposed to risk using the census method?
(2)

Page 6 of 10

Question 2 continued
b)
Defining everything you use, and making appropriate assumptions, develop a
formula for central death rates that could easily be used.
(6)

Page 7 of 10

Question 2 continued
c)
Performing any tests you consider necessary, state whether you believe that
the graduated results accurately reflect the underlying mortality of the society.
(10)

Page 8 of 10

Question 2 continued
d)
Comment on the use of graduation by standard table rather than the use of a
formula or the Whittaker Henderson method.
(4)

Page 9 of 10

Question 3 [4 marks]
Multiple decrements can be viewed using a Markov, Poisson or Binomial approach.
Describe very briefly the main considerations about which approach you would take
in practice.

END OF EXAMINATION

Page 10 of 10