Bryan and Geena had purchased a house 10 years ago. They insured the house for RM650,000 with the clause of replacement cost insurance. The house has a useful life of 100 years with current market fair value of RM700,000. How much will Bryan and Geena collect for their loss, if their house is totally destroyed in fire? Explain your answer.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Bryan and Geena had purchased a house 10 years ago. They insured the house for RM650,000 with the clause of replacement cost insurance. The house has a useful life of 100 years with current market fair value of RM700,000. How much will Bryan and Geena collect for their loss, if their house is totally destroyed in fire? Explain your answer.

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