Development Methods Restating Paid Claims

NickQZ

Hello, General question relating to the exam. For methods that involve restating paid claims like the disposal rate method or the paid berquist-sherman method, is it expected to round the estimates to the nearest full claim? It doesn't often make a difference, but when using something like exponential interpolation, the result can be somewhat different. Thank you!

Graham

Interesting question. I just checked my BS-Paid spreadsheet and I do round to the nearest integer but I did that mainly because I didn't want hidden decimals in the PDF. But here's my answer to your question:

• If the counts are large enough, it likely won't make much difference to your final answer so it shouldn't make a material difference to the final result matter whether you keep a couple of decimals or round.
• But as you said, with exponential interpolation it's possible that small differences can be magnified so to be safe (and since it's easy to keep the decimals in a spreadsheet calculation) it might be wise to keep the decimals. These restated counts are not "real" counts anyway. There are just an intermediate step in a theoretical calculation so doesn't really matter that fractional counts don't make sense in the real world.

But keep in mind that they are grading on whether you understand the method so if you did everything correctly then you should get full credit even your final answer doesn't exactly match the official answer. There are often other parts of the solution where judgment is required so your final answer will likely never exactly match the official answer anyway.

My final answer: Keep the decimals, even for restating counts.