I need help figuring this out.

## Dave purchased a $24000 life insurance policy at the price of $31 per $1000 of coverage. If he pays the premium quarterly, how much is each installment?

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# 3 Answers

Cost = $31/$1000 * $24000 = $744

Quarterly payment = $744 / 4 = **$186**

One cannot determine the answer, since you did not say whether Orr was $31 per month, quarter or annum, etc.!

John,

The mathematical information is:

Coverage: $24000 policy

Pooicy Price: $31 per $1000 of coverage ( I will assume that this is the entire cost per $1000 of policy face value.

Total policy cost is $31 * ($24000/$1000) or $31 * 24 = $744

The policy cost is paid in installment quaterly or every 3 months. (*I assume the cost is paid in
one year. The duration of quarterly payments is
NOT specified!) *Therefore the policy cost is paid in 4 equal payments.

Installment Payment = $744 / 4 = $186 every 3 months for 1 year.

*BruceS*

## Comments

Thanks!

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