Calculation of eve insurance recovery

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Best Insurance Company provides Eve Erickson with property insurance that contains an 80% coinsurance clause. The coinsurance clause states that if Eve insures the property up to 80% of its value, she will recover any loss up to the face amount of the policy. Eve purchases an $80,000 property insurance policy for property valued at $200,000. Due to a fire, Eve suffers a loss of $10,000.

What dollar amount will Eve recover from the insurance company? Explain and show your calculation of Eve's insurance recovery.

Reference no: EM132250832

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