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Question
Solve the following :
A factory building is insured for `(5/6)^"th"` of its value at a rate of premium of 2.50%. If the agent is paid a commission of ₹2,812.50, which is 7.5% of the premium, find the value of the building.
Solution
Let the property value of the factory building be ₹ x.
Since, the building is insured for `(5/6)^"th"` of its value,
∴ Policy value = `(5/6)^"th"` of property value
= `(5)/(6) xx x`
= `(5x)/(6)`
Rate of perimum is 2.5%
∴ Amount of perimum = 2.50% of policy value
= `(2.50)/(100) xx (5x)/(6)`
= `(0.1)/(4) xx (5x)/(6x)`
= `(0.5x)/(24)`
Agent’s commission is ₹2,812.50 and his rate of commission is 7.5 % of premium.
Agent’s commission = 7.5 % of premium
∴ 2,812.50 = `(7.5)/(100) xx (0.5x)/(24)`
∴ 2,812.50 = `(0.3)/(4) xx (0.5x)/(24)`
∴ 2,812.50 = `(0.1)/(4) xx (0.5x)/(8)`
∴ 2,812.50 = `(0.05x)/(32)`
∴ x = `(2,812.50 xx 32)/(0.05)`
∴ x = 56,250 x 32
∴ x = ₹18,00,000
∴ Property value of the factory building is 18 lakh rupees.
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For one year, bonus = `square/1000 xx 80,000`
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