All of the Following Statements About the Businessowners Policy Are

question 35

Multiple Choice

All of the following statements about the businessowners policy are true EXCEPT

• A)Coverage for business personal property includes coverage for leased personal property which the named insured has a contractual responsibility to insure.
• B)The amount of insurance on the buildings increases by a stated percentage each year.
• C)Additional coverages include pollutant cleanup and removal.
• D)The policy must be written with a deductible of at least $2,000 for property losses.

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Definitions:

Total Variable Costs

The total of all costs that vary with the level of output, including costs such as materials and labor that change with the scale of production.

Profit-Maximizing Level

The output level at which a firm achieves the highest possible profit, where marginal revenue equals marginal cost.

Marginal Revenue

The additional income earned by selling one more unit of a product or service.

Profit-Maximizing Level

The point at which a firm produces at a level where the difference between total revenue and total cost is the greatest.