Business Mathematics Brief 12th Edition by Stanley Salzman ,Gary Clendenen, Charles Miller

Exercise 91

In the following application problems, find the amount of the loss paid by (a) the insurance company and (b) the insured. Assume an 80 % coinsurance clause.
FOURPLEX Fang Li purchased a fourplex that has a replacement cost of $185,000. She insures it for $111,000 and has a fire loss of $28,000 when a smoker accidently starts a fire.