Chandrika L.

asked • 08/19/16

Insurance rates

 If the rate for $2,000 is 0.843, what is the rate for $1,000? Or if $5,000 costs 0.560 how much does $1,000 cost?

1 Expert Answer

By:

Mark M. answered • 08/19/16

Tutor
5.0 (278)

Mathematics Teacher - NCLB Highly Qualified

See tutors like this
See tutors like this
0.843 : 2000 :: r : 1000          proportion
2000r = 1000(0.843)              product means/extremes
2r = 0.843                              divide both sides by 1000
r = 0.4215                              divide both sides by 2
 
Or without the proportion, 1000 is one-half of 2000, so the rate would be one-half of 0.843.
 
So for the second part, 1000 is one-fifth of 5000, so the rate would be one-fifth of 0.0560.
What is that number?
Upvote • 0 Downvote
More
Report

Kenneth S.

Assuming that rates are proportional. In real life, it can be pointed out, this my not be the situation.
 
Example (from supermarket): if a great big box of cereal contains 32 ounces and costs $3.20, but a small box contains 18 ounces and costs $1.95.
 
Discounts also apply in banking situations: big wealthy clients are eligible for larger loans at lower interest rates than the ordinary Joe can even dream of.
Report

08/19/16

Chandrika L.

5000r=1000(0.560)
5r=0.560
r=0.112
 
Thank you very much!
Report

08/19/16

Mark M.

Insurance costs (life insurance) are based on "units," usually increments of $1000. Since the problem presented gave the amounts in units of $1000, I assumed that the rates were for life insurance.
 
Report

08/19/16

Still looking for help? Get the right answer, fast.

Ask a question for free

Get a free answer to a quick problem.
Most questions answered within 4 hours.

OR

Find an Online Tutor Now

Choose an expert and meet online. No packages or subscriptions, pay only for the time you need.