Question
Consider the land valuation data provided in the table below which shows how the benefits and cost of land use are impacted by a catastrophic
Consider the land valuation data provided in the table below which shows how the benefits and cost of land use are impacted by a catastrophic wind storm:
No Storm ((90%) | Storm (10%) | |
Benefits | $2,000 | $0 |
Costs | $1,500 | $1,500 |
Net Benefits |
Assuming a 5 percent interest rate, what is the expected price for land?
Group of answer choices
$10,500
$2,000
$300
$6,300
Consider the previous land valuation question. What is the actuarily accurate insurance premium
Group of answer choices
$0
$1,700
$200
$300
Consider the previous land valuation question again. Suppose government subsidizes the insurance premium by 75 percent. What is the value of land?
Group of answer choices
$1,550
$6,300
$450
$9,450
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