document.write( "Question 175401: Please help, I'm gettin no where with it. Car thieves steal on automobile out of 400 of a certain type every year in a certain city. What annual net premium should an owner pay for theft insurance in the amount of $16,000 on the certain type of car? \n" ); document.write( "
Algebra.Com's Answer #130481 by stanbon(75887)\"\" \"About 
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Car thieves steal on automobile out of 400 of a certain type every year in a certain city. What annual net premium should an owner pay for theft insurance in the amount of $16,000 on the certain type of car?
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\n" ); document.write( "That is an \"expected value\" problem.
\n" ); document.write( "The random variable is \"cost to the car owner\".
\n" ); document.write( "Cost is -x if his car is not stolen or (16000-x) if it is stolen
\n" ); document.write( "The probability of -x is (399/400); the prob of (16000-x) is (1/400)
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\n" ); document.write( "The expected value is (399/400)(-x) + (1/400)(16000-x) \r
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\n" ); document.write( "For the owner to \"break even\" this expected value should be zero.
\n" ); document.write( "(399/400)(-x) + (1/400)(16000-x) = 0
\n" ); document.write( "-399x + 16000-x = 0
\n" ); document.write( "-400x = -16000
\n" ); document.write( "x = $40.00 (His annual cost should be $40).
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\n" ); document.write( "Cheers,
\n" ); document.write( "Stan H. \n" ); document.write( "
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