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Difficulty:
25%
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76% (01:22) correct
24%
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wrong
based on 3961
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In 1960, 10 percent of every dollar paid in automobile insurance premiums went to pay costs arising from injuries incurred in car accidents. In 1990, 50 percent of every dollar paid in automobile insurance premiums went toward such costs, despite the fact that cars were much safer in 1990 than in 1960.
Which of the following, if true, best explains the discrepancy outlined above?
(A) There were fewer accidents in 1990 than in 1960.
(B) On average, people drove more slowly in 1990 than in 1960.
(C) Cars grew increasingly more expensive to repair over the period in question.
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990.
(E) Health-care costs rose sharply between 1960 and 1990.
Which of the following, if true, best explains the discrepancy outlined above?
(A) There were fewer accidents in 1990 than in 1960.
(B) On average, people drove more slowly in 1990 than in 1960.
(C) Cars grew increasingly more expensive to repair over the period in question.
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990.
(E) Health-care costs rose sharply between 1960 and 1990.
Also, in general, what does it mean when price of something increased more rapidly than the rate of inflation?
17 Oct 2013, 22:40
Kudos
Bookmarks
(A) There were fewer accidents in 1990 than in 1960. ---Incorrect, this is opposite to what we need. More money in less accidents does not solve the discrepancy.
(B) On average, people drove more slowly in 1990 than in 1960. ---- Completely irrelevant.
(C) Cars grew increasingly more expensive to repair over the period in question. --- Incorrect, we are not concerned about price of the car repair. Not related to accidents and injuries.
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990. ---- Again it does not explain why more money went into injuries from accidents even though the cars were safer.
(E) Health-care costs rose sharply between 1960 and 1990. --- Finally got what we want. An increase in health care suggests that if in 1960 $10 from $100 went into injuries from accidents. Now the same injuries to cure costs $50 from $100 because of the rise in health care costs. Perfect. CORRECT.
(B) On average, people drove more slowly in 1990 than in 1960. ---- Completely irrelevant.
(C) Cars grew increasingly more expensive to repair over the period in question. --- Incorrect, we are not concerned about price of the car repair. Not related to accidents and injuries.
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990. ---- Again it does not explain why more money went into injuries from accidents even though the cars were safer.
(E) Health-care costs rose sharply between 1960 and 1990. --- Finally got what we want. An increase in health care suggests that if in 1960 $10 from $100 went into injuries from accidents. Now the same injuries to cure costs $50 from $100 because of the rise in health care costs. Perfect. CORRECT.
General Discussion
20 Jan 2008, 12:21
Kudos
Bookmarks
(A) There were fewer accidents in 1990 than in 1960. (This weakens the argument – Eliminate it)
(B) On average, people drove more slowly in 1990 than in 1960. (This weakens the argument – eliminate it)
(C) Cars grew increasingly more expensive to repair over the period in question. (This sounds correct, but argument explicitly mentions “insurance premiums went to pay costs arising from injuries incurred in car accidents” – Eliminate it)
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990. (Rate of inflation is not discussed in the argument – Eliminate it)
(E) Health-care costs rose sharply between 1960 and 1990. (This may explain why insurance costs are high – Hold it)
Answer: E
(B) On average, people drove more slowly in 1990 than in 1960. (This weakens the argument – eliminate it)
(C) Cars grew increasingly more expensive to repair over the period in question. (This sounds correct, but argument explicitly mentions “insurance premiums went to pay costs arising from injuries incurred in car accidents” – Eliminate it)
(D) The price of insurance increased more rapidly than the rate of inflation between 1960 and 1990. (Rate of inflation is not discussed in the argument – Eliminate it)
(E) Health-care costs rose sharply between 1960 and 1990. (This may explain why insurance costs are high – Hold it)
Answer: E
