Real-World Word Problems OSU Marion Math 148

Math 148 Au2006
OSU Marion
Dr. Maharry

Get Extra Credit in Math 148 Au06 from Dr. Maharry

2 points (up to a max of 20 points for the class) for each nice example of a Real-Life word problem that you have found. A web lnk is nice, but not necessary. If you can tie it into something we're working on in class, that is even better.
2 points (up to a maximum of 10 points for the class) for each nicely written solution to someone else's problem you found on this page. Hand it in to me or email it to me at maharry@math.ohio-state.edu

Problem 1

·New Medicare drug coverage makes debut

By William M. Welch, USA TODAY

Here's how the basic benefit works. Some plans might be more generous than this:

The individual pays the first $250 in annual drug costs. That is called a $250 deductible.
The individual pays 25% of their next $2,000 in annual drug costs, so the program pays up to $1,500 and the individual pays up to $500.
After $2,250 in annual costs, the program pays nothing, and the individual pays all the next $2,850 in drug bills.
After $5,100 in drug bills, benefit protections kick in. The program pays 95% of drug costs above $5,100, and the individual pays 5%.

Here's the question:

Based on this information, what percentage of the medical costs would the government pay if your total costs were $4000? What about $400? What about $10,000? Can you find a formula for it? (It will be a "piecewise defined function")

Would it be better if the government just paid 50% of the costs? When would that be 'better' for you and when would it be better for the government?

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