Question

How does an actuary determine the best estimate rate of withdrawal?

a.

By choosing an optimistic estimate

b.

By choosing a pessimistic estimate

c.

By being conservative in choosing the withdrawal rate

d.

By analyzing past experience and estimating future conditions

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (d).By analyzing past experience and estimating future conditions Explanation:An actuary determines the best estimate rate of withdrawal by analyzing past experience and estimating future conditions.

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Q. How does an actuary determine the best estimate rate of withdrawal?
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