Question
Rose needs to buy homeowners insurance on her house, which is valued at $120,000. What is her estimated annual homeowners insurance premium?
$300
$420
$580
$870
$300
$420
$580
$870
Answers
GPT-4o mini
To estimate the annual homeowners insurance premium, a common rule of thumb is that it typically costs around 0.25% to 0.5% of the home's value per year.
Let's calculate the premium using both rates:
1. **0.25% of $120,000**:
\[
0.0025 \times 120,000 = 300
\]
2. **0.5% of $120,000**:
\[
0.005 \times 120,000 = 600
\]
Based on this information, the estimates for Rose's homeowners insurance premium would be in the range of $300 to $600.
Among the options you provided:
- $300
- $420
- $580
- $870
The estimate of **$300** falls within this range, and it is the lowest estimate. However, if we assume a more typical range and rounded amounts, **$420** or **$580** could also be reasonable premiums depending on specific coverage, location, and other factors.
Since the lowest valid calculation is **$300**, that could represent a base level for minimal coverage. Without additional specific details, the answer with the closest match for a typical premium would be **$420**. However, since technically the result of 0.25% is correct, **$300** could also be seen as a valid option.
If you have to select one and prefer a middle-ground estimate, **$420** might be advisable. If focusing strictly on calculations, **$300** is accurate.
Let's calculate the premium using both rates:
1. **0.25% of $120,000**:
\[
0.0025 \times 120,000 = 300
\]
2. **0.5% of $120,000**:
\[
0.005 \times 120,000 = 600
\]
Based on this information, the estimates for Rose's homeowners insurance premium would be in the range of $300 to $600.
Among the options you provided:
- $300
- $420
- $580
- $870
The estimate of **$300** falls within this range, and it is the lowest estimate. However, if we assume a more typical range and rounded amounts, **$420** or **$580** could also be reasonable premiums depending on specific coverage, location, and other factors.
Since the lowest valid calculation is **$300**, that could represent a base level for minimal coverage. Without additional specific details, the answer with the closest match for a typical premium would be **$420**. However, since technically the result of 0.25% is correct, **$300** could also be seen as a valid option.
If you have to select one and prefer a middle-ground estimate, **$420** might be advisable. If focusing strictly on calculations, **$300** is accurate.