Source: GMAT Prep
An insurance company has a contract with a medical laboratory to pay a discounted price for a certain medical test performed on patients referred to the laboratory by the insurance company. If the laboratory's original bill for this medical test on a patient referred by the insurance company is $230, what is the percent discount specified by the contract between the laboratory and the insurance company?
1) The insurance company is required to pay only 20 percent of the original bill for the test.
2) The insurance company is required to pay $46 for the test.
The OA is D
An insurance company has a contract with a medical
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Let's take each statement one by one.BTGmoderatorLU wrote:Source: GMAT Prep
An insurance company has a contract with a medical laboratory to pay a discounted price for a certain medical test performed on patients referred to the laboratory by the insurance company. If the laboratory's original bill for this medical test on a patient referred by the insurance company is $230, what is the percent discount specified by the contract between the laboratory and the insurance company?
1) The insurance company is required to pay only 20 percent of the original bill for the test.
2) The insurance company is required to pay $46 for the test.
The OA is D
1) The insurance company is required to pay only 20 percent of the original bill for the test.
Since the company pays 20% of the bill, the discount percent = 80%. Sufficient.
2) The insurance company is required to pay $46 for the test.
Percent discount = [(230 - 46) / 230]*100% = 80%. Sufficient.
The correct answer: D
Hope this helps!
-Jay
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The percent discount (specified by the contract) will dictate the amount the insurance company has to pay for each transaction. For instance, if the discount was 10%, the insurance company will be liable to pay $207 (230-23) out of $230. Essentially, if you can find out how much the insurance company has to pay out of the sum of $230, you can calculate the discount.
Statement (1) Company pays \(20%\). This implies the company enjoys \(80%\) discount. Sufficient
Statement (2) Company pays $46. Discount \(=\frac{230-46}{230}*100\). Sufficient
Both the statements are sufficient \(\Rightarrow\) __D__
Statement (1) Company pays \(20%\). This implies the company enjoys \(80%\) discount. Sufficient
Statement (2) Company pays $46. Discount \(=\frac{230-46}{230}*100\). Sufficient
Both the statements are sufficient \(\Rightarrow\) __D__