An insured's home is covered for $10,000 under HO-3 Form. During a violation in France, personal property valued at 3,000 is stolen from the insured's hotel room. What is the MAXIMUM amount that the insured will be reimbursed by the insurance company? a. $3,000 b. $2,400 c. $300 d. $0 3342 Which of the following policy provisions governs settlement of a claim when the insurer cannot agree on the value of the covered loss? a. apportionment b. appraisal c. assignment d. abandonment

An insured's home is covered for $10,000 under HO-3 Form. During a violation in France, personal property valued at 3,000 is stolen from the insured's hotel room. What is the MAXIMUM amount that the insured will be reimbursed by the insurance company? a. $3,000 b. $2,400 c. $300 d. $0 3342 Which of the following policy provisions governs settlement of a claim when the insurer cannot agree on the value of the covered loss? a. apportionment b. appraisal c. assignment d. abandonment

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter13: Capital, Interest, Entrepreneurship, And Corporate Finance

Section: Chapter Questions

Problem 4.8P

See similar textbooks

Similar questions

What are some ways that someone looking for a loan might reassure a bank that is faced with imperfect information about whether the borrower will repay the loan?
Suppose a person has a total credit card debt of $1,500$⁢1,500 that has a 7%7% yearly interest rate. This person also has a savings account with $2,500$⁢2,500 that pays 2%2% interest per year. Despite the net loss, the person keeps both.Calculate how many times the person appreciates the $1$⁢1 of savings more than $1$⁢1 of credit card debt if the person relates similarly to both values of percent paid and received. Enter your answer in the box below and round to two decimal places if necessary.
Why is the relationship between price and yield negative?a. Because investors reward higher cash-flows with a lower price.b. Because governments regulation prohibits a positive relationship.c. Because an increase in the yield discounts cash flows at a higher rate and so their netpresent value decreases.d. Because cash flows are variable over a bond’s life.
Assume that it is January 1, 2003. The rate of inflation is expected to be 4 percent thought 2003. However, increased government deficits and renewed vigor in the economy are then expected to push information rates higher. Investors expect the inflation rate to be 5 percent in 2004, 6 per percent cent in 2005, and 7 percent in 2006. The real risk-free rate, k*, is expected to remain at 2 percent over the next 5years. Assume that on maturity risk premiums are required on bonds with 5 years of less to maturity. The current interest rate on 5 year T-bonds is 8 Percent. What is the average expected inflation rate over the next 4 year? What should be the prevailing interest rate on 4-year T-bond? What is the implied expected inflation rate in 2007, or Year 5, give that Treasury bonds which mature in the year yield 8 percent?
Explain why pre-payment risk is more likely when a mortgage is young thanwhen the mortgage is approaching its completion date.
Carly wants to buy and operate an ice-cream truckbut doesn’t have the financial resources to start thebusiness. She borrows $20,000 from her friendFreddie, to whom she promises an interest rateof 7 percent, and gets another $30,000 from herfriend Sam, to whom she promises a third of herprofits. What best describes this situation?a. Freddie is a stockholder, and Carly is abondholder.b. Freddie is a stockholder, and Sam is abondholder.c. Sam is a stockholder, and Carly is a bondholder.d. Sam is a stockholder, and Freddie is abondholder.
Michelle has received two exciting job offers from two different companies, Tech Corp and Future Inc. Tech Corp offers a Defined Benefit Pension Plan (DBPP), while Future Inc offers a Defined Contribution Pension Plan (DCPP). As an aspiring investment enthusiast, Michelle would like to have a say in how her retirement funds are invested. 1) Which company should Michelle choose if she wants to have the freedom to make her own investment decisions? 2) If Michelle prefers a guaranteed income after retirement, which plan would suit her best? 3) Which plan potentially exposes Michelle to higher investment risk?
Deliberate specifally how and through which channelss the interest rate affects (negatively or positively) economic activities/variables and financial markets.
Now assume an investor is negotiating with the bank to pay either a 1.5% interest rate or a 2.0% interest rate on loans advanced. Will she/he be better off with the first or second option? Explain carefully.
7. 7. Secured loans mean there are usually no collateral or guarantees by a third party to secure the money lent by the bank to the borrowers in case of default. 8. A common fund trader says that the stocks of big listed companies have an equivalent liquidity as that of cash, so his fund should allocate all capital in stocks. True or false. No need explanation
1. Suppose someone’s cost of going to the ATM is $1.50, there is a 12 percent probability of having his cash lost or stolen, and he spends $5 each day. Suppose his total cost of holding cash = (547.50/T) + (0.375 × T). Find the nominal interest rate.
Problem 17-03 (algo) Suppose that a risk-free investment will make three future payments of $500 in 1 year, $500 in 2 years, and $500 in 3 years. Instructions: Round your answers to 2 decimal places. a. If the Federal Reserve has set the risk-free interest rate at 16 percent, what is the proper current price of this investment? $ b. What is the price of this investment if the Federal Reserve raises the risk-free interest rate to 18 percent? $