Chapter 5.4, Problem 1R

To determine

To understand: The importance of registration fee, and liability insurance.

Explanation of Solution

• A significance of registration fee is that the person who pays the registration fee becomes the legal owner and it helps to defray the cost of administration.
• A significance of liability insurance is it helps to reduce risk in case of uncertain events but it charges a different rate of premium to different people on the basis of age, gender, and marital status.