Question 1

About three-fourths of all health care costs are paid out of pocket by patients.

Accepted Answer

A) True 
 B)False

Question 2

Most industrialized countries emphasize private health insurance paid by employers, to provide coverage for most workers in each nation.

Accepted Answer

A) True 
 B)False

Question 3

What is one alternative to the PPACA that has been proposed?

Accepted Answer

One alternative to the PPACA would be so

Question 4

Between 1960 and 2017, U.S. health care spending as a percentage of domestic output

Accepted Answer

A) more than tripled. 
B) more than quadrupled. 
C) declined by one-half. 
D) remained relatively constant. 
A) more than tripled. 
B) more than quadrupled. 
C) declined by one-half. 
D) remained relatively constant.

Question 5

The price elasticity of demand for health care is 0.2. This means that a 5 percent increase in price will induce a

Accepted Answer

A) 10 percent decrease in quantity demanded. 
B) 5 percent decrease in quantity demanded. 
C) 2.5 percent decrease in quantity demanded. 
D) 1 percent decrease in quantity demanded. 
A) 10 percent decrease in quantity demanded. 
B) 5 percent decrease in quantity demanded. 
C) 2.5 percent decrease in quantity demanded. 
D) 1 percent decrease in quantity demanded.

Question 6

Medicare is the nationwide federal health care program available to Social Security beneficiaries and the disabled.

Accepted Answer

A) True 
 B)False

Question 7

Health care expenditures as a percentage of GDP are lower in the United States than in Germany, France, or Canada.

Accepted Answer

A) True 
 B)False

Question 8

A major implication of asymmetric information is that

Accepted Answer

A) health care suppliers may reduce the supply of health care. 
B) health care suppliers may increase the demand for health care. 
C) collusion between health care suppliers and purchasers may accelerate the rise in costs. 
D) resources may be underallocated to the health care industry. 
A) health care suppliers may reduce the supply of health care. 
B) health care suppliers may increase the demand for health care. 
C) collusion between health care suppliers and purchasers may accelerate the rise in costs. 
D) resources may be underallocated to the health care industry.

Question 9

The table shows the hypothetical demand and supply schedule for health care. If there was no health insurance, the equilibrium price and quantity of health care would be

Accepted Answer

A) $600 and 300 units. 
B) $400 and 400 units. 
C) $400 and 500 units. 
D) $500 and 400 units. 
A) $600 and 300 units. 
B) $400 and 400 units. 
C) $400 and 500 units. 
D) $500 and 400 units.

Question 10

The twin problems of the U.S. health care industry are

Accepted Answer

A) rapidly rising costs and unequal access to health care. 
B) declining quality of health care and the duplication of specialized equipment at hospitals. 
C) declining per capita spending on health care and the moral hazard problem. 
D) the decline in the number of family physicians and the failure to vaccinate children. 
A) rapidly rising costs and unequal access to health care. 
B) declining quality of health care and the duplication of specialized equipment at hospitals. 
C) declining per capita spending on health care and the moral hazard problem. 
D) the decline in the number of family physicians and the failure to vaccinate children.

Question 11

The table shows the hypothetical demand and supply schedule for health care. If private insurance covers 50 percent of the equilibrium price, how much will the insured pay and what will be their quantity of health care demanded?

Accepted Answer

A) $400 and 500 units. 
B) $400 and 400 units. 
C) $500 and 400 units. 
D) $200 and 700 units. 
A) $400 and 500 units. 
B) $400 and 400 units. 
C) $500 and 400 units. 
D) $200 and 700 units.

Question 12

Which of the following factors is not a reason why competitive pricing has not developed in the health care industry?

Accepted Answer

A) The government bans competitive pricing in health care. 
B) Consumers rarely shop around for health care providers. 
C) Insurance covers most consumers' cost of health care. 
D) Consumers are often wary of low prices in health care. 
A) The government bans competitive pricing in health care. 
B) Consumers rarely shop around for health care providers. 
C) Insurance covers most consumers' cost of health care. 
D) Consumers are often wary of low prices in health care.

Question 13

Briefly discuss the two major problems facing the health care system?

Accepted Answer

The two major problems facing the health

Question 14

The idea that one pays a relatively small known cost for protection against an uncertain and much larger cost is the basic principle behind

Accepted Answer

A) insurance. 
B) copayment. 
C) moral hazard. 
D) asymmetric information. 
A) insurance. 
B) copayment. 
C) moral hazard. 
D) asymmetric information.

Question 15

People 65 years old and older constituted about 9 percent of the U.S. population in 1960. In 2017, this percentage was around

Accepted Answer

A) the same as in 1960. 
B) 15 percent. 
C) 21 percent. 
D) 5 percent. 
A) the same as in 1960. 
B) 15 percent. 
C) 21 percent. 
D) 5 percent.

Question 16

In industrially advanced countries, the price elasticity of demand for health care is about

Accepted Answer

A) 2.0. 
B) 0.2. 
C) 4.5. 
D) 1.0. 
A) 2.0. 
B) 0.2. 
C) 4.5. 
D) 1.0.

Question 17

Approximately how many millions of Americans did not have health insurance coverage in 2017?

Accepted Answer

A) 9 
B) 29 
C) 49 
D) 63 
A) 9 
B) 29 
C) 49 
D) 63

Question 18

In recent decades, health care expenditures in the U.S. have been rising in absolute terms, but falling as a percentage of GDP.

Accepted Answer

A) True 
 B)False

Question 19

The two main types of managed-care organizations are

Accepted Answer

A) U.S. veterans' hospitals and university health clinics. 
B) health maintenance organizations (HMOs)and private nursing homes. 
C) health maintenance organizations (HMOs)and preferred provider organizations (PPOs). 
D) preferred provider organizations (PPOs)and nonprofit hospitals. 
A) U.S. veterans' hospitals and university health clinics. 
B) health maintenance organizations (HMOs)and private nursing homes. 
C) health maintenance organizations (HMOs)and preferred provider organizations (PPOs). 
D) preferred provider organizations (PPOs)and nonprofit hospitals.

Question 20

The asymmetric information problem in health care implies that the demand for health care is a "supplier-induced demand."

Accepted Answer

A) True 
 B)False

Exam 24: Health Care

About three-fourths of all health care costs are paid out of pocket by patients.

Most industrialized countries emphasize private health insurance paid by employers, to provide coverage for most workers in each nation.

What is one alternative to the PPACA that has been proposed?

Between 1960 and 2017, U.S. health care spending as a percentage of domestic output

The price elasticity of demand for health care is 0.2. This means that a 5 percent increase in price will induce a

Medicare is the nationwide federal health care program available to Social Security beneficiaries and the disabled.

Health care expenditures as a percentage of GDP are lower in the United States than in Germany, France, or Canada.

A major implication of asymmetric information is that

The table shows the hypothetical demand and supply schedule for health care. If there was no health insurance, the equilibrium price and quantity of health care would be

The twin problems of the U.S. health care industry are

The table shows the hypothetical demand and supply schedule for health care. If private insurance covers 50 percent of the equilibrium price, how much will the insured pay and what will be their quantity of health care demanded?

Which of the following factors is not a reason why competitive pricing has not developed in the health care industry?

Briefly discuss the two major problems facing the health care system?

The idea that one pays a relatively small known cost for protection against an uncertain and much larger cost is the basic principle behind

People 65 years old and older constituted about 9 percent of the U.S. population in 1960. In 2017, this percentage was around

In industrially advanced countries, the price elasticity of demand for health care is about

Approximately how many millions of Americans did not have health insurance coverage in 2017?

In recent decades, health care expenditures in the U.S. have been rising in absolute terms, but falling as a percentage of GDP.

The two main types of managed-care organizations are

The asymmetric information problem in health care implies that the demand for health care is a "supplier-induced demand."

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures Caused by Externalities Asymmetric Information

Public Goods, Public Choice, and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Costs of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Technology, RD, and Efficiency

The Demand for Resources

Wage Determination

Rent, Interest, and Profit

Natural Resource and Energy Economics

Public Finance: Expenditures and Taxes

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Income Inequality, Poverty, and Discrimination

Immigration

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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