Options, Futures, and Other Derivatives-5th Ed. J.C.Hull Ch&Prob 29-11. Need by Tuesday evening 12/2/04.

29.11 An insurance company's losses of a particular type are to a reasonable approximation normally distributed with a mean of $150 million and a standard deviation of $50 million.  (Assume no difference between losses in a risk-neutral world and losses in the real world.)  The one-year risk-free rate is 5%.  Estimate the cost of the following:
a.  A contract that will pay in one year's time 60% of the insurance company's costs on a pro rata basis.
b.  A contract that pays $100 million in one year's time if losses exceed $200 million.