Ryan P. Smith 915124536 Homework Assignment 5 30 March 2015 1.) Part A Small Warehouse worth $250,000 and tax rate of 15% Risk Management Options Fire 2% No Fire 98% Full Insurance (Premium of $6,000) $6,000 (6,000) x (1- .15) = $5,100 $6,000 (6,000) x (1- .15) = $5,100 Retention $250,000 (250,000) x (1- .15) = $212,500 $0 (0) x (1-.15) = $0 Full Insurance + Loss Control (Premium of $4,000) (Loss Control cost $1,000) $5,000 (5,000) x (1- .15) = $4,250 $5,000 (5,000) x (1- .15) = $4,250…
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