A family pays $800 per year for an insurance plan that pays

Question

A family pays $800 per year for an insurance plan that pays 80 percent of the first $1,000 in expenses and 100 percent of all medical expenses thereafter. In any given year, the total amount paid by the family will equal the amount paid by the plan when the family's medical expenses total: A. $1,000 B. $1,200 C. $1,400 D. $1,800 E. $2,200

Juaz · Answer

Money paid by family = Money paid by insurer.
1000*.2+(X-1000)*0 + 800 = 1000*.8 + (X -1000)
=> X = 1200

so B?

P.S. Here, actual money paid by insurer is 1200 - 800 (received feom family as copay) = 400. 
If we take $800 into consideration, answer should be $2000, but this is not an answer option.

Dek · Answer

B. 1200

Let the sum be x
Insurance comapny will pay:
0.8*1000 + (x-1000)

Family will pay:
800(towards insurance) + 200(remaining from the first 1000 which insurance does not cover)

So
0.8*1000 + (x-1000) = 800 + 200
800 + x-1000 = 1000
x=1200

ronron · Answer

I get the same equation, answer B is the correct one

KillerSquirrel · Answer

the OA is (B) - good work & good explanations ! :-D

ethan_casta · Answer

Juaz, that was a good catch on the (x - 1000) part of the equation. I understand after looking at your answer that the first thousand is subtracted from the total because it has already been distributed proportionately and accounted for elsewhere in the equation. Good Job!

A family pays $800 per year for an insurance plan that pays

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