Answer: Annual insurance premium would be $950.40.
Step-by-step explanation:
Since we have given that
Value of house = $198,000
Percentage of its cost is insured = 80%
Value of house is insured is given by
[tex]\dfrac{80}{100}\times 198,000\\\\=0.8\times 198,000\\\\=\$158,400[/tex]
Cost of insurance = $6 per $1000.
So, Annual insurance premium would be
[tex]\dfrac{6}{1000}\times 158,400\\\\=0.006\times 158,400\\\\=\$950.40[/tex]
Hence, Annual insurance premium would be $950.40.
