Font Size: The contents of a building are insured for $90,000 but valued at $200,000. The policy contains a 90% co-insurance clause with a $2,500 deductible. A fire damages the contents to the extent of $20,000. How much would the policy pay? OA) $7,500.00 OB) $15,500.00 OC) $10,000.00 OD) $20,000.00

Font Size: The contents of a building are insured for $90,000 but valued at $200,000. The policy contains a 90% co-insurance clause with a $2,500 deductible. A fire damages the contents to the extent of $20,000. How much would the policy pay? OA) $7,500.00 OB) $15,500.00 OC) $10,000.00 OD) $20,000.00

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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955,000 30 se0,000 15. Jay Seago is suing the manufacturer of his car for $3.5 million because of a defect that he believes caused him to have an accident. The accident kept him out of work for a year. The company has offered him a settlement of 5700,000, of which Jay would receive $600,000 after attorneys' fees. His attorney has advised him that he has a 50% chance of winning his case If he loses, he will incur attomeys' fees and court costs of $75,000. If he wins, he is not guaranteed his full requested settlement. His attorney believes that there is a 50% chance he could receive the full settlement, in which case Jay would realize $2 million after his attomey takes her cut, and a 50% chance that the jury will award him a lesser amount of $1 million, of which Jay would get $500,000. Using decision tree analysis, decide whether Jay should proceed with his lawsuit against the manufacturer.
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