percentage word problem

Question

the cost a company health plan went up 6%. the cost of coverage for jim and his family this year was $12932. what did it cost last year before the increase went into effect?

Answer 1

We can look at the inflated value of $12932 as 106% of the original cost (which will be 100%). We can therefore set up a ratio as follows:

 

($12932/106%) = (x/100%)

100% ($12932/106%) = x               | Multiply by 100% on both sides

x = $12200 (Ans.)

 

With this ratio, we can easily find that if $12932 is 106% of the old price, then taking 6% away should equal a pre-increase price of $12200.

 

Hope this helps! :)

 

Eric