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An individual owns a car that is worth 20000 and is

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An individual owns a car that is worth $20,000, and is considering buying insurance. However, the only insurance which is available has a maximum coverage of $15,000, i.e. the policy will pay only $15,000 if the car suffers a total loss in an accident. The price of the policy is $1,800. There is a 10% chance of having an accident in which the car is a total loss.

Reference no: EM13363697

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