Ben just purchased a house in an older neighborhood. after talking to several neighbors across the street, he found that he is paying much more in homeowners insurance than other homeowners in the neighborhood. ben’s house is about 30 years old. it is made of wood framing and stucco texture. it has all of it’s original plumbing and electrical work. the brick wall at the back of his back yard separates his yard from a drainage wash. which of the following is not a reasonable argument for the insurance company to use to justify ben’s higher homeowners insurance premium?

A

Step-by-step explanation:

I took the test A is the correct answer

its A. The age and outdated structural design of the house implies that remodeling is likely.  This warrants a higher premium.

Step-by-step explanation:

just took the test.

$97520

step-by-step explanation:

add 6% to the value she got from selling the house.

85.560%

step-by-step explanation:

conditional probability is defined as:

p(a|b) = p(a∩b) / p(b)

in other words, the probability that a occurs, given that b has occurred = the probability that both a and b occur / the probability that b occurs.

in this example:

p(turns 64 | turns 44) = p(turns 64 & turns 44) / p(turns 44).

if someone turns 64, they must have already turned 44, so:

p(turns 64 | turns 44) = p(turns 64) / p(turns 44)

on page 42, we see that of the original 100,000, 94944 turn 44, and 81234 turn 64.   therefore:

p(turns 64 | turns 44) = 81234 / 94944

p(turns 64 | turns 44) = 0.85560