A "Sue and Labor" Clause

question 47

Multiple Choice

A "Sue and Labor" clause

• A) directs the shipper to act in the best interest of the insurance company when a loss occurs.
• B) is the same as an Inchmaree clause.
• C) specifies that the insurer will reimburse the shipper for goods that have been abandoned after a stranding or a sinking, as long as the costs of recovering the goods and making them marketable is greater than their value.
• D) All of the above
• E) None of the above

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Definitions:

User Cost

The cost of using a good or service, which includes the opportunity cost of not using the asset in an alternative use.

Opportunity Cost

The cost of choosing one option over another, typically represented by the benefits that could have been gained by choosing the alternative.

Depletable Resource

A natural resource that can be diminished or exhausted by use, such as fossil fuels, minerals, or forests.

Extraction Cost

The expenses associated with the removal of raw materials from their natural setting for use or sale.