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InstructionMultiple Choice

Auto Insurance

Question 3 • 26-27 Ignite Financial Literacy Personal Finance - EL3403

After being involved in a car accident last month, Ralph’s insurance company has increased his annual premium by $105.38. Approximately what change will Ralph see on his future monthly statements as a result of the change?

Answer
A
Ralph’s monthly insurance payment will not change.
B
Ralph’s monthly insurance payment will increase by $8.78.
C
Ralph’s monthly insurance payment will increase by $17.56.
D
Ralph’s monthly insurance payment will increase $105.38.

Explanation

Divide the $105.38 increase in the annual premium by 12 months: $105.38 ÷ 12 ≈ $8.78 per month. Therefore, Ralph’s monthly insurance payment will increase by approximately $8.78.

AI-written and checked against the verified answer.

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