Past exam of the mathematics course of the University of Cambridge / 2008 / iii / Paper 41 / 5 / a / ii

With right censoring, an event has not occurred by the last observation time $C$, so the data establish only $T>C$. One records $Y=\min (T,C)$ and $\delta =1_{\{T\le C\}}$, distinguishing an observed event from a censored exit. A business still operating at the follow-up deadline is administratively right-censored. Its observed age is a lower bound on its lifetime, not its eventual closure age. Standard survival analysis requires suitable independent censoring, possibly conditional on the fitted covariates.