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An Insurance Company Evaluates Many Numerical Variables About a Person

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An insurance company evaluates many numerical variables about a person before deciding on an appropriate rate for automobile insurance.The number of claims a person has made in the last 3 years is an example of a numerical variable.


Definitions:

Present Values

The present equivalent of a future money sum or cash flow series, calculated using a particular rate of return.

Student Loans

Financial borrowings aimed at financing higher education expenses, subject to repayment with interest.

Interest Rate

The amount charged by a lender to a borrower for the use of assets, usually expressed as a percentage of the principal.

Monthly Payment

Periodic payments made towards loans, typically calculated monthly, covering interest and principal repayment.

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