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Foundations of Casualty Actuarial Science
marketplace of goods and prices or the marketplace of
business practice.
10. Distinguishing attributes of actuarial science
i Actuaries begin with the final problem; they work
backwards to devise an optimal solution.
ii Actuaries seek optimal solutions, not perfect
solutions. Business problems rarely have perfect
solutions.
iii The actuary considers all constraints, whether they
seem reasonable or not.
iv The marketplace is the ultimate arbiter of the
actuary's performance.
11. The subjects span an enormous spectrum: mathematics,
statistics, economics, finance, modeling, underwriting,
ratemaking, reserving, accounting, law, investments,
taxes, valuation, financial engineering, and other fields.
12. Actuarial science has changed radically in the past few
decades, in two ways.
a) Today's actuary must be proficient in modeling,
finance, investments, and accounting, in addition to
the traditional actuarial topics.
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