BuyFind

Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
Publisher: Cengage Learning
ISBN: 9781305585447
BuyFind

Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
Publisher: Cengage Learning
ISBN: 9781305585447

Solutions

Chapter
Section
Chapter 19, Problem 8AT
Textbook Problem

Mary Hall purchased a $45,000 20-year endowment life insurance policy when she was 20 years old. She is now 35 years old and wants to look into her nonforfeiture options. As her insurance agent, calculate the value of Mary’s three options.

a. Option 1 b. Option 2

c. Option 3

Expert Solution

(a)

To determine

To calculate: The value of Mary’s option 1 if she purchased a $45,000 20-Year endowment life insurance policy at the age of 20 years and her current age is 35 years.

Explanation of Solution

Given Information:

Mary Hall purchased a $45,000 20-Year endowment life insurance policy at the age of 20 years and her current age is 35 years.

Formula used:

Steps to calculate the value of NONFORFEITURE option 1-cash value,

Step 1: Divide the face value of policy by $1,000 to calculate the number of $1,000 of insurance desired. And round to the nearest whole $1,000.

Number of $1,000=Face value of policy$1,000

Step 2: From the table 19-3 locate the appropriate dollars per $1,000 in cash value column.

Step 3: Multiply the figure from step 2 with the number of $1,000 of insurance.

Calculation:

Consider the provided data,

The policy is a 20-Year endowment life insurance policy with a face value of $45,000

Expert Solution

(b)

To determine

To calculate: The value of Mary’s option 2 if she purchased a $45,000 20-Year endowment life insurance policy at the age of 20 years and her current age is 35 years.

Expert Solution

(c)

To determine

The value of Mary’s option 3 if she purchased a $45,000 20-Year endowment life insurance policy at the age of 20 years and her current age is 35 years.

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Chapter 19 Solutions

Contemporary Mathematics for Business & Consumers
Show all chapter solutions
Ch. 19.I - Calculate the annual. semiannual, quarterly, and...Ch. 19.I - Calculate the annual. semiannual, quarterly, and...Ch. 19.I - Calculate the value of the nonforfeiture options...Ch. 19.I - Calculate the value of the nonforfeiture options...Ch. 19.I - Calculate the value of the nonforfeiture options...Ch. 19.I - Calculate the value of the nonforfeiture options...Ch. 19.I - Calculate the value of the nonforfeiture options...Ch. 19.I - Leroy Kirk is 35 years old and is interested in...Ch. 19.I - 16. Rene Boyer, age 27. wants to purchase a 5-year...Ch. 19.I - Carmen Gutierrez purchased a $75,000, 20-payment...Ch. 19.I - 18. Alex Baron is evaluating his life insurance...Ch. 19.I - Richard Ryan is evaluating his life insurance...Ch. 19.I - BUSINESS DECISION: THE CONSULTATION 20. Tina...Ch. 19.II - You are the insurance agent for Diamond...Ch. 19.II - A property insurance policy has an annual premium...Ch. 19.II - A property insurance policy has an annual premium...Ch. 19.II - Bravo Manufacturing, Inc., had property valued at...Ch. 19.II - Savoy International had multiple carrier fire...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the building, contents, and total...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the short-term premium and refund for...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - Calculate the amount to be paid by the insurance...Ch. 19.II - You are the insurance agent for Castle Mountain...Ch. 19.II - A property insurance policy has an annual premium...Ch. 19.II - 22. Insignia Enterprises has a property insurance...Ch. 19.II - Hi-Volt Electronics had multiple carrier fire...Ch. 19.II - BUSINESS DECISION: BUSINESS INTERRUPTION INSURANCE...Ch. 19.III - Jeff Wasserman, owner of High Performance Racing...Ch. 19.III - Jody Burnett has automobile liability insurance in...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - As an insurance agent, calculate the annual...Ch. 19.III - 9. Rick Clinton wants to purchase an automobile...Ch. 19.III - 10. Howard Marshall’s Corvette was hit by a palm...Ch. 19.III - Ben Hoffman has motor vehicle liability insurance...Ch. 19.III - BUSINESS DECISION: INSURING THE FLEET 12. The...Ch. 19 - A mechanism for reducing financial risk and...Ch. 19 - 2. The amount of protection provided by an...Ch. 19 - 3. Name the two major categories of life...Ch. 19 - The _____ factor is a small surcharge added to the...Ch. 19 - The options available to a policyholder upon...Ch. 19 - 6. The difference between the total living...Ch. 19 - 7. List four perils covered by property insurance....Ch. 19 - 8. List the four factors used to determine the...Ch. 19 - The premium charged when a policy is canceled by...Ch. 19 - The clause in a property insurance policy...Ch. 19 - 11. Write the coverage ratio formula used in...Ch. 19 - 12. A situation in which a business is covered by...Ch. 19 - In motor vehicle insurance, ____covers bodily...Ch. 19 - In motor vehicle insurance, companies often...Ch. 19 - Calculate the annual, semiannual, quarterly, and...Ch. 19 - Calculate the annual, semiannual, quarterly, and...Ch. 19 - Calculate the annual, semiannual, quarterly, and...Ch. 19 - Calculate the annual, semiannual, quarterly, and...Ch. 19 - Calculate the value of the nonforfeiture options...Ch. 19 - Calculate the value of the nonforfeiture options...Ch. 19 - Tommy Cook is 19 years old and is interested in...Ch. 19 - 8. Mary Hall purchased a $45,000 20-year endowment...Ch. 19 - Joe Moutran is evaluating his life insurance...Ch. 19 - Calculate the building, contents, and total...Ch. 19 - Calculate the building, contents, and total...Ch. 19 - Calculate the building, contents, and total...Ch. 19 - Calculate the short-term premium and refund for...Ch. 19 - Calculate the short-term premium and refund for...Ch. 19 - Calculate the amount to be paid by the insurance...Ch. 19 - Calculate the amount to be paid by the insurance...Ch. 19 - 17. You are the insurance agent for Fandango...Ch. 19 - 18. “Movers of the Stars" has been contracted by...Ch. 19 - La Belle Beauty Supply had property valued at...Ch. 19 - Pinnacle Manufacturing has multiple carrier fire...Ch. 19 - As an insurance agent, calculate the annual...Ch. 19 - As an insurance agent, calculate the annual...Ch. 19 - As an insurance agent, calculate the annual...Ch. 19 - 24. Karen Doyle wants to purchase an automobile...

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