Question

Between 1975 and 1985, nursing-home occupancy rates averaged 87 percent of capacity, while admission rates remained constant, at an average of 95 admissions per 1,000 beds per year. Between 1985 and 1988, however, occupancy rates rose to an average of 92 percent of capacity, while admission rates declined to 81 per 1,000 beds per year.

If the statements above are true, which of the following conclusions can be most properly drawn?

(This question is from Official Guide. Therefore, because of copyrights, the complete question cannot be copied here. The question can be accessed at GMAT Club)

Solution

Understanding the Passage

Between 1975 and 1985, nursing-home occupancy rates averaged 87 percent of capacity, while admission rates remained constant, at an average of 95 admissions per 1,000 beds per year.

Occupancy rate = 87% = 87 beds occupied for every 100 beds = 870 beds occupied for every 1000 beds

Admission rate = 95 admissions per 1000 beds

Thus, for every 1000 beds, 870 are occupied while there are 95 admissions.

How can so many beds be occupied while there are only 95 admissions?
There’s only way: on average, individuals in nursing homes are staying for many years.

How many years, on average?

870/95 i.e. about 9 years.

Between 1985 and 1988, however, occupancy rates rose to an average of 92 percent of capacity, while admission rates declined to 81 per 1,000 beds per year.

Occupancy rate = 92% = 92 beds occupied for every 100 beds = 920 beds occupied for every 1000 beds

Admission rate = 81 admissions per 1000 beds

How many years, on average, an individual stays in nursing homes?

920/81 i.e. about 11 years.

Options Evaluation

(A) Correct.

As we understood from the passage, the average length of stay must be longer to account for the changes in occupancy and admission rates.

(B) Incorrect.

The proportion talked about in this option can be thought of in two ways:

  1. Number of older people in nursing homes/Number of older people in the population
    • This proportion tells us how big a segment of the older people in the population is of those living in nursing homes
  2. Number of older people in nursing homes/Number of people in nursing homes
    • This proportion tells us how big a segment of the people in nursing homes is of older people

None of these proportions are can be inferred from the passage.

The first proportion cannot be inferred since we have no information about the number of older people in the population.

The second proportion cannot be inferred since we don’t know whether older people stay longer in nursing homes than younger people. Besides, even if, for our discussion sake, we assume that older people stay longer in nursing homes than younger people, we still cannot infer this proportion because it’s possible that the average length of stay increased because of older people staying for even longer in 1988 than in 1975 and not because there were proportionately more older people in nursing homes.

(C) Incorrect

Just on the basis of a certain movement between data points, we cannot infer a trend. This option says that nursing home admission rates TEND to decline whenever occupancy rates rise. We cannot infer this TENDENCY from movements in just two time periods. Doing so would be the same as concluding that CJ tends to get sick by eating a banana from the facts that CJ did not have a banana yesterday and was not sick and that CJ had a banana today and is sick today.

(D) Incorrect

Since both the data points are per 1000 beds, we cannot say anything about the total number of beds for any time period. Besides, this option is talking about number of beds per nursing home. We have ZERO information about the number of nursing homes and the number of beds in them.

(E) Incorrect

The passage nowhere talks about the number of beds or occupancy rates of individual nursing homes.

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