After reviewing her driving record for the past 3 years, Cindy’s insurance company offers her a good driver discount of 4.5%. Her original policy was based on the premiums listed below. What is her new annual premium including the discount?Cindy's Auto Insurance PolicyType of Insurance CoverageCoverage LimitsAnnual PremiumsBodily Injury $50/100,000$31.75 Property Damage$25,000 $120.50 Collision$500 deductible$275.75 Comprehensive$100 deductible$100.00
First add the annual premiums: $31.75 + $120.50 + $275.75 + $100.00 = $528.00. A 4.5% discount means Cindy pays 95.5% of the original premium: $528.00 × 0.955 = $504.24. The new annual premium is $504.24, choice a.
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