Question 1

Since 1960, health care costs in the United States have risen absolutely but remained constant as a percentage of gross domestic product.

Accepted Answer

A) True 
 B)False

Question 2

The Patient Protection and Affordable Care Act (PPACA)of 2010 is designed to address a wide-ranging set of issues including the following, except

Accepted Answer

A) the large portion of health spending supported by government insurance. 
B) the high and rising cost of health insurance and health care spending. 
C) the fact that tens of millions of Americans do not have health insurance. 
D) the inability of many people with preexisting conditions to obtain health insurance. 
A) the large portion of health spending supported by government insurance. 
B) the high and rising cost of health insurance and health care spending. 
C) the fact that tens of millions of Americans do not have health insurance. 
D) the inability of many people with preexisting conditions to obtain health insurance.

Question 3

Insurance tends to drive up health care costs by encouraging greater use of health care resources. Why has this occurred in the United States but not in Canada or the United Kingdom?

Accepted Answer

A) There is no health care insurance in Canada or the United Kingdom. 
B) Canada and the United Kingdom use nonprice rationing to contain costs. 
C) Canada and the United Kingdom have better health care technology that allows them to achieve lower costs than the United States. 
D) Only private insurance creates an incentive to overuse health care resources. 
A) There is no health care insurance in Canada or the United Kingdom. 
B) Canada and the United Kingdom use nonprice rationing to contain costs. 
C) Canada and the United Kingdom have better health care technology that allows them to achieve lower costs than the United States. 
D) Only private insurance creates an incentive to overuse health care resources.

Question 4

Which of the following would increase the supply of health care services?

Accepted Answer

A) increased practice of defensive medicine 
B) more tax subsidies for consumers 
C) increases in physicians' productivity 
D) increases in health insurance coverage 
A) increased practice of defensive medicine 
B) more tax subsidies for consumers 
C) increases in physicians' productivity 
D) increases in health insurance coverage

Question 5

What are the two main types of managed-care organizations (or systems)that are used to control health care costs?

Accepted Answer

Managed care organizations are being wid

Question 6

Refer to the graph of a hypothetical market for health care. If there was not health insurance, the equilibrium price and quantity of health care would be

Accepted Answer

A) $20 and 600 units. 
B) $40 and 450 units. 
C) $60 and 300 units. 
D) $80 and 450 units. 
A) $20 and 600 units. 
B) $40 and 450 units. 
C) $60 and 300 units. 
D) $80 and 450 units.

Question 7

Changes in the average age of the U.S. population over the past decade have decreased the demand for health care.

Accepted Answer

A) True 
 B)False

Question 8

Singapore encourages competition in its health care market by

Accepted Answer

A) requiring hospitals to post prices for services and by government publishing hospital performance records. 
B) avoiding any government involvement in the health care market. 
C) operating government-run hospitals to compete directly with private hospitals. 
D) outsourcing all of its health care services to foreign providers. 
A) requiring hospitals to post prices for services and by government publishing hospital performance records. 
B) avoiding any government involvement in the health care market. 
C) operating government-run hospitals to compete directly with private hospitals. 
D) outsourcing all of its health care services to foreign providers.

Question 9

Approximately how many workers are employed in the U.S. health care industry?

Accepted Answer

A) 713,800 
B) 931,200 
C) 12 million 
D) 20 million 
A) 713,800 
B) 931,200 
C) 12 million 
D) 20 million

Question 10

In 2007, approximately what percentage of people in the United States with private health insurance received it as an employer-provided benefit?

Accepted Answer

A) 35 
B) 50 
C) 88 
D) 95 
A) 35 
B) 50 
C) 88 
D) 95

Question 11

There is a consensus among economists that the amount of resources allocated to the health care industry is optimal.

Accepted Answer

A) True 
 B)False

Question 12

The problem of asymmetric information is that

Accepted Answer

A) neither health care buyers nor providers are well-informed. 
B) health care providers are well-informed, but buyers are not. 
C) the outcomes of many complex medical procedures cannot be predicted. 
D) insurance companies are well-informed, but policy purchasers are not. 
A) neither health care buyers nor providers are well-informed. 
B) health care providers are well-informed, but buyers are not. 
C) the outcomes of many complex medical procedures cannot be predicted. 
D) insurance companies are well-informed, but policy purchasers are not.

Question 13

Explain how unhealthy lifestyles contribute to increasing health care costs.

Accepted Answer

Substance abuse helps drive up health ca

Question 14

The employer mandate of the PPACA requires that

Accepted Answer

A) every firm must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
B) every firm with 50 or more full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
C) every firm with fewer than 50 full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
D) every firm with 500 or more employees must establish their own on-site medical facilities to provide employees with basic medical care. 
A) every firm must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
B) every firm with 50 or more full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
C) every firm with fewer than 50 full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee. 
D) every firm with 500 or more employees must establish their own on-site medical facilities to provide employees with basic medical care.

Question 15

Health insurance induces consumers to adopt less prevention and overconsumption of health care.

Accepted Answer

A) True 
 B)False

Question 16

The United States devotes about ______ percent of its gross domestic product to health care (2017).

Accepted Answer

A) 5.2 
B) 8.6 
C) 15.3 
D) 17.9 
A) 5.2 
B) 8.6 
C) 15.3 
D) 17.9

Question 17

The table gives supply and demand data for a certain elective surgical procedure. Without health insurance, the equilibrium price and quantity would be

Accepted Answer

A) $2,000 and 700. 
B) $3,000 and 7,000. 
C) $1,000 and 1,000. 
D) $2,000 and 4,000. 
A) $2,000 and 700. 
B) $3,000 and 7,000. 
C) $1,000 and 1,000. 
D) $2,000 and 4,000.

Question 18

The percentage of cost that an insured individual pays while the insurer pays the remainder would be considered

Accepted Answer

A) copayments. 
B) deductibles. 
C) play-or-pay. 
D) fee for service. 
A) copayments. 
B) deductibles. 
C) play-or-pay. 
D) fee for service.

Question 19

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 20

Which of the following is a supply factor in the health care market?

Accepted Answer

A) defensive medicine 
B) the aging of the population 
C) slow productivity growth in the health care industry 
D) asymmetric information 
A) defensive medicine 
B) the aging of the population 
C) slow productivity growth in the health care industry 
D) asymmetric information

Exam 24: Health Care

Since 1960, health care costs in the United States have risen absolutely but remained constant as a percentage of gross domestic product.

The Patient Protection and Affordable Care Act (PPACA)of 2010 is designed to address a wide-ranging set of issues including the following, except

Insurance tends to drive up health care costs by encouraging greater use of health care resources. Why has this occurred in the United States but not in Canada or the United Kingdom?

Which of the following would increase the supply of health care services?

What are the two main types of managed-care organizations (or systems)that are used to control health care costs?

Refer to the graph of a hypothetical market for health care. If there was not health insurance, the equilibrium price and quantity of health care would be

Changes in the average age of the U.S. population over the past decade have decreased the demand for health care.

Singapore encourages competition in its health care market by

Approximately how many workers are employed in the U.S. health care industry?

In 2007, approximately what percentage of people in the United States with private health insurance received it as an employer-provided benefit?

There is a consensus among economists that the amount of resources allocated to the health care industry is optimal.

The problem of asymmetric information is that

Explain how unhealthy lifestyles contribute to increasing health care costs.

The employer mandate of the PPACA requires that

Health insurance induces consumers to adopt less prevention and overconsumption of health care.

The United States devotes about ______ percent of its gross domestic product to health care (2017).

The table gives supply and demand data for a certain elective surgical procedure. Without health insurance, the equilibrium price and quantity would be

The percentage of cost that an insured individual pays while the insurer pays the remainder would be considered

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

Which of the following is a supply factor in the health care market?

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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