Thank you Lindsay.
I am now looking at (i) of Question 2 at the end of Ch 17. It says that the basis may be fully realistic. Could the basis be different - i.e. could prudential basis be used instead? I don't think so, because we are trying to calculate EV and therefore would tend to use best estimate market consistent, or fully realistic (e.g. best estimate for all assumptions, including discount curves and investment returns).
In (ii) of this question, I understand the first 3 marks of the answers given in the solutions, but the last 6 marks available do not make sense. I am struggling to understand the concepts. Can you help explain?
Thank you,
Rachael
Last edited: Jan 14, 2024