A new drug will extend life by 5 years at a quality of life of 69% and average life span is 79.1 and the Value of a Statistical Life is $8mn. Calculate the QALYS value (answer in dollars, 225.251)

Question

BlackTom AI · Accepted Answer

To tackle this calculation, we start by identifying the key inputs: a 5-year life extension, a quality of life (QoL) factor of 69%, and the Value of a Statistical Life (VSL) at $8 million.
Next, convert the QoL to a decimal: 69% becomes 0.69.
Then compute the QALYs gained from the life extension: 5 years × 0.69 = 3.45 QALYs.
Now translate those QALYs into dollars using the VSL: 3.45 QALYs × $8,000,000 per QALY (conceptually, the VSL represents the value of a statistical life year across the population) equals $27,600,000.
At this point, it’s useful to compare this result with the provided answer to check for consistency. The given value (225.251) appears far from the calculation above, suggesting either a different valuation method, unit interpretation, or a misprint in the target value.
Breaking down potential sources of mismatch:
- If the VSL is applied per life year rather than per complete life, you’d multiply 3.45 by a smaller annual value; for example, $8,000,000 divided by expected remaining years would yield a different per-year figure.
- If the problem intends thousands or millions as the base unit, missing a scale factor (e.g., thousands of dollars) could produce a much smaller number like 225.251, but that would require an explicit scaling step.
- If the QoL figure were interpreted differently (e.g., a utility less than 1 due to discounting or alternative health state valuation), the resulting QALYs could change accordingly.
In this setup, the straightforward multiplication 3.45 QALYs by $8,000,000 yields a value on the order of tens of millions of dollars, far exceeding 225.251, indicating a possible mismatch between the intended method and the provided target.
If you have a specific formula or scaling rule the question intends (for example, applying VSL to QALYs with a particular discount rate or converting to thousands of dollars), I can apply that method step by step and show how the final figure could align with 225.251 under those rules.

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A new drug will extend life by 5 years at a quality of life of 69% and average life span is 79.1 and the Value of a Statistical Life is $8mn. Calculate the QALYS value (answer in dollars, 225.251)

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