Question

Sylvia Baxter's Cape Cod home has a replacement value of value

of $175,000. She insures it for 80 percent of its replacement value. Loss of use coverage is 15
percent of the replacement value. What is the amount of coverage on loss of use?
A. $28,000 B. $26,250 C. $21,000
D. $35,000

Answer 1

B

Explanation:

To calculate the amount of coverage on loss of use, we need to determine 15 percent of the replacement value of the home.

Given:

Replacement value of the home = $175,000

Loss of use coverage is 15 percent of the replacement value.

Loss of use coverage = 15% of $175,000

To find 15% of a value, we can multiply the value by 0.15.

Loss of use coverage = $175,000 * 0.15

Loss of use coverage = $26,250

Therefore, the amount of coverage on loss of use is $26,250, which corresponds to option B.

(Hope this helps bro ^^)