Question 1

How can increases in a country's total income improve health?

Accepted Answer

Increases in a country's total income ma

Question 2

The number of people receiving Medicare is expected to grow to 80 million by the year

Accepted Answer

A)  2105. 
B)  2020. 
C)  2030. 
D)  2075. 
A)  2105. 
B)  2020. 
C)  2030. 
D)  2075.

Question 3

Figure 7-4   Figure 7-4 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services.
-All of the following are part of the "individual mandate" provision of the Patient Protection and Affordable Care Act (ACA) except

Accepted Answer

A)  individuals are allowed to opt out of the insurance program if they can prove they have no serious health issues and do so before the act fully takes effect in the year 2014. 
B)  by 2016, fines for not having health insurance will be the greater of $695 per person or 2.5 percent of income. 
C)  beginning in 2014, individuals who do not acquire health insurance will be subject to a fine. 
D)  with limited exceptions, every resident of the United States will be required to have health insurance that meets certain basic requirements. 
A)  individuals are allowed to opt out of the insurance program if they can prove they have no serious health issues and do so before the act fully takes effect in the year 2014. 
B)  by 2016, fines for not having health insurance will be the greater of $695 per person or 2.5 percent of income. 
C)  beginning in 2014, individuals who do not acquire health insurance will be subject to a fine. 
D)  with limited exceptions, every resident of the United States will be required to have health insurance that meets certain basic requirements.

Question 4

Figure 7-2   Figure 7-2 represents the market for vaccinations. Vaccinations are considered a benefit to society, and the figure shows both the marginal private benefit and the marginal social benefit from vaccinations.
-Refer to Figure 7-2. The efficient equilibrium price is

Accepted Answer

A)  $60. 
B)  $50. 
C)  $40. 
D)  <$40. 
A)  $60. 
B)  $50. 
C)  $40. 
D)  <$40.

Question 5

Economists refer to the actions people take after they have entered into a transaction that makes the other party to the transaction worse off as

Accepted Answer

A)  bad faith. 
B)  economic inefficiency. 
C)  moral hazard. 
D)  market failure. 
A)  bad faith. 
B)  economic inefficiency. 
C)  moral hazard. 
D)  market failure.

Question 6

A goal of market-based reforms of the health care system is to give patients an incentive to pay more attention to the prices of medical services. This would tend to ________ economic efficiency by ________ the costs of medical services

Accepted Answer

A)  increase; increasing 
B)  increase; decreasing 
C)  decrease; increasing 
D)  decrease; decreasing 
A)  increase; increasing 
B)  increase; decreasing 
C)  decrease; increasing 
D)  decrease; decreasing

Question 7

The study of the problems due to asymmetric information was begun when economists analyzed which type of market?

Accepted Answer

A)  the market for citrus fruit 
B)  the market for insurance 
C)  farmers' markets 
D)  the market for automobiles 
A)  the market for citrus fruit 
B)  the market for insurance 
C)  farmers' markets 
D)  the market for automobiles

Question 8

Changes in the health of the average person are an important indicator of changes in the standard of living.

Accepted Answer

A) True 
 B)False

Question 9

Figure 7-5   Figure 7-5 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services.
-Refer to Figure 7-5. The efficient quantity of medical services is

Accepted Answer

A)  400. 
B)  800. 
C)  1,200. 
D)  >1,200. 
A)  400. 
B)  800. 
C)  1,200. 
D)  >1,200.

Question 10

Figure 7-4   Figure 7-4 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services.
-Refer to Figure 7-4. With insurance and a third-party payer system, what price do doctors receive for medical services?

Accepted Answer

A)  $25 
B)  $40 
C)  $55 
D)  >$55 
A)  $25 
B)  $40 
C)  $55 
D)  >$55

Question 11

The situation in which one party to a transaction takes advantage of knowing more than the other party to the transaction is known as asymmetric information.

Accepted Answer

A) True 
 B)False

Question 12

How might a company that offers to handle all paperwork involved with a health insurance claim for a flat fee face the problem of adverse selection?

Accepted Answer

Adverse selection is the situation in wh

Question 13

Of the following high-income countries, which has the highest mortality ratio for cancer?

Accepted Answer

A)  Canada 
B)  Japan 
C)  the United Kingdom 
D)  the United States 
A)  Canada 
B)  Japan 
C)  the United Kingdom 
D)  the United States

Question 14

Of the following, the rapid rise in health care costs in the United States can be attributed to

Accepted Answer

A)  the cost of malpractice insurance. 
B)  the cost to treat uninsured patients. 
C)  slow growth in labor productivity in health care. 
D)  the cost of malpractice lawsuit settlements. 
A)  the cost of malpractice insurance. 
B)  the cost to treat uninsured patients. 
C)  slow growth in labor productivity in health care. 
D)  the cost of malpractice lawsuit settlements.

Exam 7: The Economics of Health Care

How can increases in a country's total income improve health?

The number of people receiving Medicare is expected to grow to 80 million by the year

Figure 7-2 Figure 7-2 represents the market for vaccinations. Vaccinations are considered a benefit to society, and the figure shows both the marginal private benefit and the marginal social benefit from vaccinations. -Refer to Figure 7-2. The efficient equilibrium price is

Economists refer to the actions people take after they have entered into a transaction that makes the other party to the transaction worse off as

A goal of market-based reforms of the health care system is to give patients an incentive to pay more attention to the prices of medical services. This would tend to ________ economic efficiency by ________ the costs of medical services

The study of the problems due to asymmetric information was begun when economists analyzed which type of market?

Changes in the health of the average person are an important indicator of changes in the standard of living.

Figure 7-5 Figure 7-5 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services. -Refer to Figure 7-5. The efficient quantity of medical services is

Figure 7-4 Figure 7-4 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services. -Refer to Figure 7-4. With insurance and a third-party payer system, what price do doctors receive for medical services?

The situation in which one party to a transaction takes advantage of knowing more than the other party to the transaction is known as asymmetric information.

How might a company that offers to handle all paperwork involved with a health insurance claim for a flat fee face the problem of adverse selection?

Of the following high-income countries, which has the highest mortality ratio for cancer?

Of the following, the rapid rise in health care costs in the United States can be attributed to

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency, Government Price Setting, and Taxes

Externalities, Environmental Policy, and Public Goods

Elasticity: the Responsiveness of Demand and Supply

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Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology, Production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: the Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, Taxes, and the Distribution of Income

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money, Banks, and the Federal Reserve System

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Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

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A goal of market-based reforms of the health care system is to give patients an incentive to pay more attention to the prices of medical services. This would tend to economic efficiency by the costs of medical services