A property insurance policy provides full coverage to the loss of the policyholder in the next year. The size and probability of potential losses are given below: Possible Loss ($) Probability 0 .95 5,000 .04 10,000 .01 Assume: 1) the fair premium is collected at the beginning of the year; 2) the administrative expenses and the profit loading are paid at the beginning of the year; 3) claims, if any, are paid at the end of the year; 4) the investment return is 6%; 5) the expected administrative expenses are assumed to be 10% of the expected claim cost; 6) the profit loading is equal to 3% of the fair premium. What is the present value of expected claim costs?

• A. Between 270 and 280
• B. Between 280 and 290
• C. Between 300 and 310
• D. None of the above