AAPL wrote:**Official Guide**

Did Insurance Company \(K\) have more than $300 million in total net profits last year?

1. Last year Company \(K\) paid out $0.95 in claims for every dollar of premiums collected.

2. Last year Company \(K\) earned a total of $150 million in profits from the investment of accumulated surplus premium from previous years.

OA E

**Target question:** **Did Insurance Company \(K\) have more than $300 million in total net profits last year?**
Jump straight to...

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** Statements 1 and 2 combined **
Statement 2 tells us about profits from ONE PART of Company K's business.

Statement 1 tells us a tiny bit about Company K's expenses.

There are several scenarios that satisfy BOTH statements. Here are two:

Case a: Company K earned a total of $150 million in profits from ONE PART of its business, and another $100 Billion in profits from the OTHER PARTS of its business. In this case, the answer to the target question is

YES, Company K DID have more than $300 million in total net profits last year.
Case b: Company K earned a total of $150 million in profits from ONE PART of its business, and LOST $100 Billion in the OTHER PARTS of its business. In this case, the answer to the target question is

NO, Company K did NOT have more than $300 million in total net profits last year.
Since we cannot answer the

target question with certainty, the combined statements are NOT SUFFICIENT

Answer: E

Cheers,

Brent