Reference no: EM133046284

You've just graduated from TRSM with a degree in Business Management and you're excited to start your new career as a teller with Alterna Savings - a Toronto Credit Union. You live in Rexdale, but your new job is at the Scarborough branch, so you need to buy a car to get to and from work. You spoke with your Branch Manager, Makena Zuri, about borrowing $17,000 to purchase a vehicle, and she has informed you that Alterna Savings can loan you the funds as a part of your employment. She also advised you that the Credit Union has a program set up so you can pay for the car with regular monthly deductions from your pay, interest-free.

As Ontario law stipulates, however, every car in the province must have insurance, so you now need to inform your boss which insurance policy you will purchase before asking her to finalize the loan transfer. Given the distance to and from work and how often you will be travelling, you estimate that there is a 0.2% chance you will end up in an accident and have to replace the full value of the car.

You have narrowed your choice down to three insurance options that strike you intuitively as the best:

• Scotiabank has offered you: $11,000 max coverage at a premium of $240
• CAA has offered you full insurance at a premium of $275
• Intact has offered you a premium of $260 with a $5,000 deductibleIn a properly formatted memo, and assuming you will maximize expected value, write to your boss Makena Zuri informing her of the expected value of each of the three options and identifying your choice of insurance. Be sure to ask her to finalize the transfer for the purchase.

Your memo (not including the header) should be fewer than 150 words.