Question

Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If the consumer price index has gone up 4%, how much may Ron increase the face value of the policy

Answer 1

Answer:

4,000

Explanation:

Ron has a life insurance policy with a face value of 100,000

The consumer price index has gone up by 4%

Therefore the increase in the policy face value can be calculated as follows

= 100,000 × 4/100

= 100,000 × 0.04

= 4,000