Question

Calculate the annual premium for each life insurance policy.

Face Value of Policy Cost per $1,000

$35,000 $9.27

$70,500 $33.36

$500,000 $17.86

Answer 1

Face value of policy Annual Premium

$35,000 $324.45

$70,500 $2351.88

$500,000 $8930.00

Explanation:

Face value of policy Cost per $1,000

$35,000 $9.27

$70,500 $33.36

$500,000 $17.86

Annual premium
`=\frac{\text{Premium}}{1000}*\text{Face Value}`

• Face value = $35,000 and Premium = $9.27 / $1000

Annual premium
`=(9.27)/(1000)*35000`

`=\$324.45`

• Face value = $70,500 and Premium = $33.36 / $1000

Annual premium
`=(33.36)/(1000)*70500`

`=\$2351.88`

• Face value = $500,000 and Premium = $17.86 / $1000

Annual premium
`=(17.86)/(1000)*500000`

`=\$8930.00`

Below table shown annual premium for respective face value.

Face value of policy Annual Premium

$35,000 $324.45

$70,500 $2351.88

$500,000 $8930.00