Nerdo Computers Had an Insurance Policy on Its Premises, for Which

question 2

Multiple Choice

Nerdo Computers had an insurance policy on its premises, for which it paid a premium of $525 per year. It found a new broker who offered a much lower rate, so it wrote to its current broker to cancel its existing policy. The broker replied that there would be a $100 cancellation fee. Which of the following facts or arguments would help Nerdo avoid having to pay the fee?

• A)If the fee is not mentioned in the contract
• B)If the fee can be characterized as a penalty
• C)If the fee is not a genuine pre-estimate of damages.
• D)Both B and C
• E)All of the above

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Definitions:

Middle Ear

The chamber between the eardrum and cochlea containing three tiny bones (hammer, anvil, and stirrup) that concentrate the vibrations of the eardrum on the cochlea’s oval window.

Eardrum Vibrations

are oscillations of the tympanic membrane in response to sound waves, crucial for the mechanical process of hearing.

Vestibular Sacs

Structures within the inner ear that contribute to the body's sense of balance and spatial orientation by detecting gravity and linear movement.

Temporal Lobe

A region of the brain responsible for processing auditory information and encoding memory.