Which of the Following Is a Distinguishing Characteristic of Comprehensive

question 11

Multiple Choice

Which of the following is a distinguishing characteristic of comprehensive general liability insurance?

• A) It compensates for liability for damage to the property of third parties.
• B) It compensates for liability for personal injuries suffered by a third party.
• C) It compensates a third party's property damage and personal injuries.
• D) It compensates for losses sustained directly by the insured itself.

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Definitions:

Opportunity Costs

The cost of foregoing the next best alternative when making a decision. It represents the benefits an individual, investor, or business misses out on when choosing one alternative over another.

Fixed Costs

Expenses that do not change with the level of goods or services produced over the short term.

Variable Costs

Costs that vary directly with the level of production or business activity, such as raw materials, packaging, and labor directly involved in a company's manufacturing process.

Sunk Costs

Expenses that have already been incurred and cannot be recovered or altered, and should not be considered in future business decisions.