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Art Appraiser

Real-Life Activities

Real-Life Math -- Solution

The insurance company will pay the claim based on the high end of the fair market value. You assessed that to be $10,000, but you take 15 percent off that due to depreciation.

$10,000 x 0.15 = $1,500 off the original price
$10,000 - $1,500 = $8,500

The company pays 90 percent of that, so:

$8,500 x 0.90 = $7,650

The insurance company needs to pay $7,650.