User Account

All Pages

Regarding the distribution of subrogation amounts

Assignment Help Financial Management
Reference no: EM131911683

Sarah has a house valued at $200,000 and insured for $180,000. It is totally destroyed by fire, due to the negligence of Courtney. Sarah recovers $180,000 from her insurer, which then subrogates against Courtney. Suppose the courts decide that Courtney must pay $100,000 in damages, because that's all the money she has. How much of this $100,000 can the insurer keep, assuming that the policy has no special provision regarding the distribution of subrogation amounts?

A) $80,000 (Sarah gets the other $20,000)

B) $100,000 (Sarah will get no additional funds)

C) $20,000 (Sarah gets the other $80,000)

D) $0 (The entire $100,000 must be passed on to Sarah)

please explain

Reference no: EM131911683

Questions Cloud

Tannen industries is considering an expansion : Tannen Industries is considering an expansion. The potential sale of the building represents a real option and therefore should not be charged against project.
What is the initial investment outlay for the spectrometer : What is the initial investment outlay for the spectrometer, that is, what is the Year 0 project cash flow?
How much will chuck insurer pay for all bodily injuries : Chuck has an accident in which he is at fault. how much will Chuck's insurer pay, in total, for all the bodily injuries?
Ratio analysis-what is apple current cash flow position : Using a ratio analysis, what is the current financila information on the company Apple? What is Apple's current cash flow position?
Regarding the distribution of subrogation amounts : Assuming that the policy has no special provision regarding the distribution of subrogation amounts?
Compute the irr static for project : Compute the IRR static for Project E. The appropriate cost of capital is 9 percent. Should the project be accepted or rejected?
Calculate the after-tax rate of return on the taxable bond : Calculate the after-tax rate of return on the taxable bond? Which security bond should you buy?
What is the company current stock price : The corrigan company just paid a dividend of $ 1.20 per share, What is the company's current stock price to 2 decimal places?
What is the growth rate of dividends and earnings : What is the growth rate of earnings? What is the growth rate of dividends?

Reviews

Write a Review

Financial Management Questions & Answers

  Chapter 7 what overall net income would be produced if the

what overall net income would be produced if the admission rate of the capitated group were reduced from the commercial

  Market interest rate for bonds of similar risk and maturity

Salt Foods purchases twenty $1,000, 6%, 10-year bonds issued by Pretzelmania, Inc., for $21,559 on January 1. The market interest rate for bonds of similar risk and maturity is 5%. Salt Foods receives interest semiannually on June 30 and December 31.

  Define the stated rate and the periodic rate

Define the stated rate, the periodic rate, and the effective annual rate. How are these three rates related?

  What are its coupon rate current yield and yield to maturity

A 6-year bond pays interest of $80 annually and sells for $950. What are its coupon rate, current yield, and yield to maturity?

  What are the supply-side policies

What are the supply-side policies? Why is a bond said to be trading at a premium when the yield is lower than the coupon rate?

  The correlation between the returns of the two stocks

Two stocks (Stock J and Stock K) have the same current stock price, and the same standard deviation. There exists a call option on 100 shares of Stock J, a call option on 100 shares of Stock K, and a call option on a portfolio of 50 shares of J and 5..

  What is the default risk premium on keys bonds

What is the default risk premium (DRP) on Keys' bonds?

  The dividend is expected to increase

A firm recently paid a $0.50 annual dividend. The dividend is expected to increase by 10 percent in each of the next four years. In the fourth year, the stock price is expected to be $23. If the required return for this stock is 13.5 percent, what is..

  What will be the value of her retirement account

Carla Lopez deposits $9070 a year into her retirement account. If these funds have an average earning of 7 percent over the 15 years until her retirement, what will be the value of her retirement account?

  Determine the value of verto shares

You found that Verto stock is expected to generate earnings of $4.38 per share this year and that the mean PE ratio for its industry is 27.195. Use the PE valuation method to determine the value of Verto shares.

  What is the most you would be willing to pay for this bond

You are interested in investing in a five-year bond that pays a 9.38 percent coupon rate with interest to be received semiannually. Your required rate of return is 9.13 percent. What is the most you would be willing to pay for this bond?

  Health plan premium

Health PLan Premium. If a health plan covers 150,000 lives expects 25 myocardial infarctions to occur each year within the covered lives, expects a length of stay of 4.5 days for each MI, and has to pay an average of $950 per day each day the MI pati..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd