An individual who has automobile insurance from a certain company is randomly selected. Let Y be the number of moving violations for which the individual was cited during the last 3 years. The pmf of Y is the following.
| y |
0 |
1 |
2 |
3 |
| p(y) |
0.60 |
0.25 |
0.10 |
0.05 |
(a) Compute E(Y).
E(Y) =
(b) Suppose an individual with Y violations incurs a surcharge of $110Y2. Calculate the expected amount of the surcharge.
$