David owns a commercial building with a replacement cost of $4 million.The building is insured on a replacement cost basis for $3 million under a fire insurance policy that has an 80 percent coinsurance clause.How much will David collect if the building sustains a covered fire loss with a replacement cost of $320,000?
A)$266,667
B)$275,000
C)$300,000
D)$320,000

Question

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The Answer of David owns a commercial building with a replacement cost of $4 million.The building is insured on a replacement cost basis for $3 million under a fire insurance policy that has an 80 percent coinsurance clause.How much will David collect if the building sustains a covered fire loss with a replacement cost of $320,000?
A)$266,667
B)$275,000
C)$300,000
D)$320,000

David Owns a Commercial Building with a Replacement Cost of $4