Her home has a replacement value of $150,000, therefore she insures her home for the minimum legal requirement of

$120,000

Explanation:

There is actually no minimum legal home insurance requirement. But if you have a mortgage on your house, the lender will require home insurance that covers at least the loan amount.  

Regarding insurance companies, the 80% rule applies. This means that she must purchase an insurance policy that covers at least 80% of her house's replacement value = $150,000 x 80% = $120,000. If her policy covers less, then in case she files a claim, the insurance company will pay only a proportionate amount of the repairs or replacement value.

answer; ///(c) i believe its it ignores cash flows following the payback period;

answer; drop shippers;