Question 1

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. B

Question 2

It is generally agreed that in the long run the cost of private health insurance provided by employers is:

Accepted Answer

A)  at the expense of business profits. 
B)  at the expense of real wages. 
C)  paid by taxpayers through government. 
D)  included as taxable income for income tax purposes. 
A)  at the expense of business profits. 
B)  at the expense of real wages. 
C)  paid by taxpayers through government. 
D)  included as taxable income for income tax purposes. B

Question 3

Rising health care costs have prompted workers to change jobs with greater frequency.

Accepted Answer

A) True 
 B)False  False

Question 4

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

Accepted Answer

A)  850,000. 
B)  925,000. 
C)  5.8 million. 
D)  17 million. 
A)  850,000. 
B)  925,000. 
C)  5.8 million. 
D)  17 million.

Question 5

Employer-provided private health insurance in the United States has resulted in:

Accepted Answer

A)  incentives that encourage the overuse of health care. 
B)  incentives that discourage the use of health care,and overall poorer health. 
C)  lower costs of health care as providers better achieve economies of scale. 
D)  comprehensive coverage of the U.S.population,with few lacking access to adequate health care. 
A)  incentives that encourage the overuse of health care. 
B)  incentives that discourage the use of health care,and overall poorer health. 
C)  lower costs of health care as providers better achieve economies of scale. 
D)  comprehensive coverage of the U.S.population,with few lacking access to adequate health care.

Question 6

In 2011,some 49 million Americans did not have health insurance.

Accepted Answer

A) True 
 B)False

Question 7

Suppose you go to a doctor,but your health insurance plan reimburses you for only 80 percent of the bill.This is an example of:

Accepted Answer

A)  a copayment. 
B)  a deductible. 
C)  monopsony power. 
D)  a deferred benefit plan. 
A)  a copayment. 
B)  a deductible. 
C)  monopsony power. 
D)  a deferred benefit plan.

Question 8

In industrially advanced countries,estimates suggest the income elasticity of demand for health care is about:

Accepted Answer

A)  +3. 
B)  +6. 
C) -2. 
D)  +1. 
A)  +3. 
B)  +6. 
C) -2. 
D)  +1.

Question 9

Approximately how many millions of Americans do not have health insurance (prior to gaining coverage through the Patient Protection and Affordable Care Act)?

Accepted Answer

A)  27. 
B)  49. 
C)  58. 
D)  63. 
A)  27. 
B)  49. 
C)  58. 
D)  63.

Question 10

Which of the following statements is true about health care costs in the United States?

Accepted Answer

A)  Costs have risen because increases in the price of health care have more than offset reductions in the quantity of health care provided. 
B)  Costs have risen because increases in the quantity of care provided have more than offset price reductions realized through economies of scale. 
C)  Costs have risen because both the price of health care and the quantity provided have risen. 
D)  Costs have remained relatively stable as price increases have been largely offset by reductions in the quantity provided. 
A)  Costs have risen because increases in the price of health care have more than offset reductions in the quantity of health care provided. 
B)  Costs have risen because increases in the quantity of care provided have more than offset price reductions realized through economies of scale. 
C)  Costs have risen because both the price of health care and the quantity provided have risen. 
D)  Costs have remained relatively stable as price increases have been largely offset by reductions in the quantity provided.

Question 11

Subsidies for those required to purchase health insurance under the personal mandate provision of the PPACA are:

Accepted Answer

A)  limited to those whose income is less than 133 percent of the federal poverty line. 
B)  limited to those whose income is at or below the federal poverty line. 
C)  provided to some individuals in the upper half of the income distribution. 
D)  a fixed amount per person for those eligible to receive the subsidies. 
A)  limited to those whose income is less than 133 percent of the federal poverty line. 
B)  limited to those whose income is at or below the federal poverty line. 
C)  provided to some individuals in the upper half of the income distribution. 
D)  a fixed amount per person for those eligible to receive the subsidies.

Question 12

Other things equal,and given that the elasticity of demand for health care is 0.2,a 10 percent increase in the price of health care in the United States will reduce the quantity of health care demanded by about:

Accepted Answer

A)  1 percent. 
B)  2 percent. 
C)  5 percent. 
D)  20 percent. 
A)  1 percent. 
B)  2 percent. 
C)  5 percent. 
D)  20 percent.

Question 13

Preferred provider organizations (PPOs)are a type of managed-care organization.

Accepted Answer

A) True 
 B)False

Question 14

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 15

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 16

Roughly what portion of U.S.total health spending is paid for by private and public insurance?

Accepted Answer

A)  One-tenth. 
B)  One-fourth. 
C)  Four-fifths. 
D)  One-half. 
A)  One-tenth. 
B)  One-fourth. 
C)  Four-fifths. 
D)  One-half.

Question 17

The health care market is characterized by:

Accepted Answer

A)  extensive negative externalities. 
B)  significant positive externalities. 
C)  perfect knowledge by both buyers and sellers. 
D)  a perfectly inelastic demand. 
A)  extensive negative externalities. 
B)  significant positive externalities. 
C)  perfect knowledge by both buyers and sellers. 
D)  a perfectly inelastic demand.

Question 18

All of the following are designed to reduce health care expenses for consumers except:

Accepted Answer

A)  HMOs. 
B)  PPOs. 
C)  the DRG payment system. 
D)  the fee-for-service system. 
A)  HMOs. 
B)  PPOs. 
C)  the DRG payment system. 
D)  the fee-for-service system.

Question 19

The perceived central economic problem associated with the U.S.health care system is:

Accepted Answer

A)  too many frivolous malpractice lawsuits. 
B)  an overabundance of scanning machines. 
C)  an overallocation of resources to the system. 
D)  that workers lose their insurance when they lose their jobs. 
A)  too many frivolous malpractice lawsuits. 
B)  an overabundance of scanning machines. 
C)  an overallocation of resources to the system. 
D)  that workers lose their insurance when they lose their jobs.

Question 20

Which of the following persons is most likely to be insured for health care?

Accepted Answer

A)  A minimum-wage teenager working for a fast-food restaurant. 
B)  A skilled worker employed by a large multinational corporation. 
C)  An unemployed retail clerk. 
D)  A part-time groundskeeper for a small manufacturing plant. 
A)  A minimum-wage teenager working for a fast-food restaurant. 
B)  A skilled worker employed by a large multinational corporation. 
C)  An unemployed retail clerk. 
D)  A part-time groundskeeper for a small manufacturing plant.

Exam 23: Health Care

The problem of asymmetric information is that:

It is generally agreed that in the long run the cost of private health insurance provided by employers is:

Rising health care costs have prompted workers to change jobs with greater frequency.

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

Employer-provided private health insurance in the United States has resulted in:

In 2011,some 49 million Americans did not have health insurance.

Suppose you go to a doctor,but your health insurance plan reimburses you for only 80 percent of the bill.This is an example of:

In industrially advanced countries,estimates suggest the income elasticity of demand for health care is about:

Approximately how many millions of Americans do not have health insurance (prior to gaining coverage through the Patient Protection and Affordable Care Act)?

Which of the following statements is true about health care costs in the United States?

Subsidies for those required to purchase health insurance under the personal mandate provision of the PPACA are:

Other things equal,and given that the elasticity of demand for health care is 0.2,a 10 percent increase in the price of health care in the United States will reduce the quantity of health care demanded by about:

Preferred provider organizations (PPOs)are a type of managed-care organization.

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

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

Roughly what portion of U.S.total health spending is paid for by private and public insurance?

The health care market is characterized by:

All of the following are designed to reduce health care expenses for consumers except:

The perceived central economic problem associated with the U.S.health care system is:

Which of the following persons is most likely to be insured for health care?

Income Inequality Poverty and Discrimination

Immigration

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

The Balance of Payments, Exchange Rates, and Trade Deficits

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

The United States and the Global Economy

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