Water damage from a major flood in a Midwestern city resulted in damages estimated at $108 million. As a result of the claimant payouts, insurance companies raised homeowners' insurance rates by an average of $59 per year for each of the 160,000 households in the affected city. If a 20-year study period is considered, what was the rate of return on the $108 million paid by the insurance companies?
Water damage from a major flood in a Midwestern city resulted in damages estimated at $108 million. As a result of the claimant payouts, insurance companies raised homeowners' insurance rates by an average of $59 per year for each of the 160,000 households in the affected city. If a 20-year study period is considered, what was the rate of return on the $108 million paid by the insurance companies?
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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![Water damage from a major flood in a Midwestern city resulted in damages estimated at $108 million. As a result of the
claimant payouts, insurance companies raised homeowners' insurance rates by an average of $59 per year for each of the
160,000 households in the affected city. If a 20-year study period is considered, what was the rate of return on the $108
million paid by the insurance companies?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Febfb12c5-3029-4c87-9c33-36a20e65e29e%2F0321df5c-296f-411f-b088-650143650b9d%2Fxkwfazi_processed.png&w=3840&q=75)
Transcribed Image Text:Water damage from a major flood in a Midwestern city resulted in damages estimated at $108 million. As a result of the
claimant payouts, insurance companies raised homeowners' insurance rates by an average of $59 per year for each of the
160,000 households in the affected city. If a 20-year study period is considered, what was the rate of return on the $108
million paid by the insurance companies?
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