Question 1

The health care industry currently absorbs about 18 percent of U.S.gross domestic product.

Accepted Answer

A) True 
 B)False

Question 2

Insurance exchanges:

Accepted Answer

A)  are government-regulated markets where individuals can purchase health insurance to satisfy the personal mandate provision of the PPACA. 
B)  are expected to significantly increase health care costs by expanding government regulation. 
C)  are government-regulated markets where prices are set directly by federal regulators. 
D)  allow patients to get medical treatment when away from the providers covered by their regular health insurance. 
A)  are government-regulated markets where individuals can purchase health insurance to satisfy the personal mandate provision of the PPACA. 
B)  are expected to significantly increase health care costs by expanding government regulation. 
C)  are government-regulated markets where prices are set directly by federal regulators. 
D)  allow patients to get medical treatment when away from the providers covered by their regular health insurance.

Question 3

Aggregate U.S.health care spending in 2011 was approximately:

Accepted Answer

A)  6 percent of domestic output (GDP). 
B)  13 percent of domestic output (GDP). 
C)  18 percent of domestic output (GDP). 
D)  21 percent of domestic output (GDP). 
A)  6 percent of domestic output (GDP). 
B)  13 percent of domestic output (GDP). 
C)  18 percent of domestic output (GDP). 
D)  21 percent of domestic output (GDP).

Question 4

The Patient Protection and Affordable Care Act prohibits insurance companies from denying coverage to anyone on the basis of a preexisting medical condition.

Accepted Answer

A) True 
 B)False

Question 5

Because employer payments for health insurance are not subject to income or payroll taxes,government in effect provides a subsidy to health care.

Accepted Answer

A) True 
 B)False

Question 6

Insurance companies use deductibles and copayments to control increases in the amount of health care demanded.

Accepted Answer

A) True 
 B)False

Question 7

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 8

Health care expenditures coming directly out of consumers' pockets,primarily in the form of deductibles and copayments,account for what percent of U.S.health care spending?

Accepted Answer

A)  17 percent. 
B)  33 percent. 
C)  50 percent. 
D)  83 percent. 
A)  17 percent. 
B)  33 percent. 
C)  50 percent. 
D)  83 percent.

Question 9

Some employers have reacted to rising health care costs by hiring more part-time and temporary workers.

Accepted Answer

A) True 
 B)False

Question 10

Asymmetric information in the health care market has increased the supply of health care.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following provisions of the PPACA do proponents expect to reduce the growth of health care spending?

Accepted Answer

A)  Prohibiting insurers from dropping or denying individuals with preexisting conditions. 
B)  Allowing individuals to purchase coverage through insurance exchanges. 
C)  Subsidizing purchases of insurance for those complying with the personal mandate. 
D)  Expanding access to Medicaid coverage. 
A)  Prohibiting insurers from dropping or denying individuals with preexisting conditions. 
B)  Allowing individuals to purchase coverage through insurance exchanges. 
C)  Subsidizing purchases of insurance for those complying with the personal mandate. 
D)  Expanding access to Medicaid coverage.

Question 12

Employer-provided private health insurance began in the United States because:

Accepted Answer

A)  the rising threat of socialism prompted U.S.companies to provide insurance to dampen enthusiasm for socialist reform. 
B)  during World War II,wage and price controls forced employers to use nonwage forms of compensation to attract workers. 
C)  poor health conditions at the beginning of the 20th century prompted the U.S.government to require new companies to offer health insurance to employees. 
D)  the American Medical Association successfully lobbied the U.S.government to provide subsidies to companies offering private health insurance to employees. 
A)  the rising threat of socialism prompted U.S.companies to provide insurance to dampen enthusiasm for socialist reform. 
B)  during World War II,wage and price controls forced employers to use nonwage forms of compensation to attract workers. 
C)  poor health conditions at the beginning of the 20th century prompted the U.S.government to require new companies to offer health insurance to employees. 
D)  the American Medical Association successfully lobbied the U.S.government to provide subsidies to companies offering private health insurance to employees.

Question 13

(Consider This)In 2010,the Medicare and Medicaid programs reimbursed approximately what percentage of hospitals' total cost of providing care to the patients covered by those programs?

Accepted Answer

A)  80 percent. 
B)  92 percent. 
C)  100 percent. 
D)  105 percent. 
A)  80 percent. 
B)  92 percent. 
C)  100 percent. 
D)  105 percent.

Question 14

The major purpose of Medicare is to:

Accepted Answer

A)  provide health care services to people on Social Security. 
B)  provide health care services to those receiving public assistance. 
C)  contain rising health care costs. 
D)  make a basic health care package available to all Americans. 
A)  provide health care services to people on Social Security. 
B)  provide health care services to those receiving public assistance. 
C)  contain rising health care costs. 
D)  make a basic health care package available to all Americans.

Question 15

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 16

Which of the following is a provision of the Patient Protection and Affordable Care Act?

Accepted Answer

A)  Insurance companies may not legally deny coverage to anyone on the basis of a preexisting medical condition. 
B)  Every firm must purchase health insurance for their employees or face a $2,000 fine per employee. 
C)  Every individual must purchase their own health insurance for themselves and their dependents or pay a fine. 
D)  Adult children of parents with employer-provided health insurance can remain covered by their parents' insurance through age 35. 
A)  Insurance companies may not legally deny coverage to anyone on the basis of a preexisting medical condition. 
B)  Every firm must purchase health insurance for their employees or face a $2,000 fine per employee. 
C)  Every individual must purchase their own health insurance for themselves and their dependents or pay a fine. 
D)  Adult children of parents with employer-provided health insurance can remain covered by their parents' insurance through age 35.

Question 17

As a percentage of GDP,health care spending in the United States has:

Accepted Answer

A)  decreased substantially since 1960. 
B)  increased slightly since 1960. 
C)  increased substantially since 1960. 
D)  remained relatively constant since 1960. 
A)  decreased substantially since 1960. 
B)  increased slightly since 1960. 
C)  increased substantially since 1960. 
D)  remained relatively constant since 1960.

Question 18

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 19

Given the availability of the Medicaid program,why are so many poor people uninsured?

Accepted Answer

A)  Because only a fixed percentage of the population can participate in Medicaid at any time. 
B)  Because many poor people earn enough that they do not qualify for Medicaid. 
C)  Because nonincome requirements screen many poor people from the program. 
D)  Because only native-born Americans are eligible for the program. 
A)  Because only a fixed percentage of the population can participate in Medicaid at any time. 
B)  Because many poor people earn enough that they do not qualify for Medicaid. 
C)  Because nonincome requirements screen many poor people from the program. 
D)  Because only native-born Americans are eligible for the program.

Question 20

A moral hazard problem arises in the health care market because health insurance encourages people to overconsume health care.

Accepted Answer

A) True 
 B)False

Exam 23: Health Care

The health care industry currently absorbs about 18 percent of U.S.gross domestic product.

Insurance exchanges:

Aggregate U.S.health care spending in 2011 was approximately:

The Patient Protection and Affordable Care Act prohibits insurance companies from denying coverage to anyone on the basis of a preexisting medical condition.

Because employer payments for health insurance are not subject to income or payroll taxes,government in effect provides a subsidy to health care.

Insurance companies use deductibles and copayments to control increases in the amount of health care demanded.

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

Health care expenditures coming directly out of consumers' pockets,primarily in the form of deductibles and copayments,account for what percent of U.S.health care spending?

Some employers have reacted to rising health care costs by hiring more part-time and temporary workers.

Asymmetric information in the health care market has increased the supply of health care.

Which of the following provisions of the PPACA do proponents expect to reduce the growth of health care spending?

Employer-provided private health insurance began in the United States because:

(Consider This)In 2010,the Medicare and Medicaid programs reimbursed approximately what percentage of hospitals' total cost of providing care to the patients covered by those programs?

The major purpose of Medicare is to:

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

Which of the following is a provision of the Patient Protection and Affordable Care Act?

As a percentage of GDP,health care spending in the United States has:

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?

Given the availability of the Medicaid program,why are so many poor people uninsured?

A moral hazard problem arises in the health care market because health insurance encourages people to overconsume 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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