Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized for You

we will pick new questions that match your level based on your Timer History

Track Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

It appears that you are browsing the GMAT Club forum unregistered!

Signing up is free, quick, and confidential.
Join other 500,000 members and get the full benefits of GMAT Club

Registration gives you:

Tests

Take 11 tests and quizzes from GMAT Club and leading GMAT prep companies such as Manhattan GMAT,
Knewton, and others. All are free for GMAT Club members.

Applicant Stats

View detailed applicant stats such as GPA, GMAT score, work experience, location, application
status, and more

Books/Downloads

Download thousands of study notes,
question collections, GMAT Club’s
Grammar and Math books.
All are free!

Thank you for using the timer!
We noticed you are actually not timing your practice. Click the START button first next time you use the timer.
There are many benefits to timing your practice, including:

Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

17 Dec 2010, 07:33

5

This post received KUDOS

30

This post was BOOKMARKED

00:00

A

B

C

D

E

Difficulty:

85% (hard)

Question Stats:

54% (01:25) correct 46% (01:45) wrong based on 631 sessions

HideShow timer Statistics

Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower. Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300. Which of the following is a cost level for which both insurance plans pay out the same amount?

Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower. Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300. Which of the following is a cost level for which both insurance plans pay out the same amount?

$600 $1000 $3800 $5300 $6200

Pay out for plan A: Cost-$1,000 or Cost-0.5*Cost=0.5*Cost, when 0.5*Cost<$1,000; Pay out for plan B: 0.8(Cost-$300);

The question is: for which of the following costs the pay outs are the same.

C-1,000=0.8(C-300) --> for C=3,800 and 0.5C=0.8(C-300) --> for C=800. As we have only $3,800 listed then it must be a correct answer.

Or you can use backsolving for this question: A. C=$600: pay out for plan A will be 0.5*600=300 (as 0.5*600<1,000) and pay out for plan B will be 0.8*(600-300)=240;

B. C=$1000: pay out for plan A will be 0.5*1,00=500 (as 0.5*1,000<1,000) and pay out for plan B will be 0.8*(1,000-300)=560;

C. C=$3800: pay out for plan A will be 3,800-1,000=2,800 (as 0.5*3,800>1,000) and pay out for plan B will be 0.8*(3,800-300)=2,800 --> 2,800=2,800;

D. C=$5300: pay out for plan A will be 5,300-1,000=4,300 (as 0.5*5,300>1,000) and pay out for plan B will be 0.8*(5,300-300)=4,000;

E. C=$6200:pay out for plan A will be 6,200-1,000=5,200 (as 0.5*6,200>1,000) and pay out for plan B will be 0.8*(6,200-300)=4,720.

Well i think the Ans would be C because i use the same method as the other member showed you above and i don't think there is another way of finding that pay out plan...
_________________

Any sufficiently advanced technology is indistinguishable from magic.

Concentration: International Business, General Management

GPA: 3.86

WE: Accounting (Commercial Banking)

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

22 May 2012, 18:54

Hi Bunnel.

According to me the 2 equations are: 0.8(C – 300) + 300= 1000 OR 0.8(C – 300) + 300= 0.5C

But i am confused with the question you formed the two equations

C-1,000=0.8(C-300)--->1^st and 0.5C=0.8(C-300)

Since the questions says if the cost is above 1000 he will pay which ever is lower, but according to your 1st equation he is paying more that 1000 i.e is 2800, please clarify if i am wrong, awaiting for your reply
_________________

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

22 May 2012, 19:37

5

This post received KUDOS

kotela wrote:

Hi Bunnel.

According to me the 2 equations are: 0.8(C – 300) + 300= 1000 OR 0.8(C – 300) + 300= 0.5C

But i am confused with the question you formed the two equations

C-1,000=0.8(C-300)--->1^st and 0.5C=0.8(C-300)

Since the questions says if the cost is above 1000 he will pay which ever is lower, but according to your 1st equation he is paying more that 1000 i.e is 2800, please clarify if i am wrong, awaiting for your reply

You are reading the question wrong. It is asking when the insurance company will pay the same amount of money not the insured.

0.8(C–300) = C–1000 OR 0.8(C–300) = 0.5C

Solving the first equation gives us C=3800 Solving the second equation gives us C=800

Since 800 isn't one of the answers we can eliminate it and 3800 is the only possible answer.

Concentration: International Business, General Management

GPA: 3.86

WE: Accounting (Commercial Banking)

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

22 May 2012, 21:19

Cares wrote:

kotela wrote:

Hi Bunnel.

According to me the 2 equations are: 0.8(C – 300) + 300= 1000 OR 0.8(C – 300) + 300= 0.5C

But i am confused with the question you formed the two equations

C-1,000=0.8(C-300)--->1^st and 0.5C=0.8(C-300)

Since the questions says if the cost is above 1000 he will pay which ever is lower, but according to your 1st equation he is paying more that 1000 i.e is 2800, please clarify if i am wrong, awaiting for your reply

You are reading the question wrong. It is asking when the insurance company will pay the same amount of money not the insured.

0.8(C–300) = C–1000 OR 0.8(C–300) = 0.5C

Solving the first equation gives us C=3800 Solving the second equation gives us C=800

Since 800 isn't one of the answers we can eliminate it and 3800 is the only possible answer.

The correct answer is C.

Ya you are i misread the question....thanks for that and +1 kudos for you
_________________

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

03 Dec 2013, 06:50

Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
_________________

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

22 Mar 2015, 04:33

TooLong150 wrote:

Algebra is truly a loser in this question. Backsolving is the fastest and most effective method here.

Having to rely on backsolving is truly hit or miss when it comes to timing.

If you've mastered algebra, not only can you virtually solve most of the problems on the test, but this problem can also be completed around 30 seconds. Seems like a pretty fast time to me

Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower. Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300. Which of the following is a cost level for which both insurance plans pay out the same amount?

A. $600 B. $1000 C. $3800 D. $5300 E. $6200

Case 1: What Insured pay is 1000 (as per plan A) = 300+(20/100)*(C-300) Solving this equation, C = 3800

Case 2: What Insured pay is (50/100)*C (as per plan A) = 300+(20/100)*(C-300) Solving this equation, C = 800

Answer: Option C
_________________

Prosper!!! GMATinsight Bhoopendra Singh and Dr.Sushma Jha e-mail: info@GMATinsight.com I Call us : +91-9999687183 / 9891333772 Online One-on-One Skype based classes and Classroom Coaching in South and West Delhi http://www.GMATinsight.com/testimonials.html

Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

20 Nov 2015, 10:56

"Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower." - this confused me much. if i quoted the fee in my job this way i would be fired =)

my clients would understand this without doubt: if the cost is 10 000 then the client has to pay only 1000 =))) yuuuupi
_________________

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

19 Jan 2016, 11:25

Absolutely agree...pathetic and horridly ambiguous wording....sch kind of wording never appears on gmat...pooh to Manhattan! The stmnt makes it seem as if we HV to choose whether 1000 bucks or C/2 is the payout, C being insurance cost...will sue GMAT if such poorly worded question appears.

Re: Health insurance Plan A requires the insured to pay $1000 or [#permalink]

Show Tags

30 Jul 2017, 06:49

anilnandyala wrote:

Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower. Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300. Which of the following is a cost level for which both insurance plans pay out the same amount?

A. $600 B. $1000 C. $3800 D. $5300 E. $6200

Out of line .... this question is more of an SC question where you need to look at part "Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300" where 'but then pays 80%' is mentioned for insurance company... otherwise this question would be some 600 level.