Adams Purchases Insurance Coverage from Prince Insurance Company for His

question 57

Essay

Adams purchases insurance coverage from Prince insurance company for his office building.There is an increase of hazards clause in the contract.However,after some days Adams is forced to keep highly explosive material in the office building for official purpose.The building sustains damage from inside due to an explosion caused by the hazardous substance.Adams now seeks insurance coverage for the loss.Prince is refusing to pay.Will Adams succeed in getting his insurance claim paid?

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Definitions:

Supply

The total amount of a good or service that is available for purchase at any given price.

Perfectly Inelastic

Describes a situation where the quantity demanded or supplied does not change in response to a price change.

Recession

A period of declining real GDP, accompanied by lower real income and higher unemployment.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices over a given period of time.