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?

Question

I need help figuring this out.

Answer 1

Cost = $31/$1000  *  $24000 = $744

Quarterly payment = $744 / 4 = $186

Answer 2

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

Answer 3

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