Question 1

Insurance _______ the price for medical care, thereby _______ the demand for it.

Accepted Answer

A)  increases; decreases 
B)  decreases; decreases 
C)  increases; increases 
D)  decreases; increases 
E)  None of the above 
A)  increases; decreases 
B)  decreases; decreases 
C)  increases; increases 
D)  decreases; increases 
E)  None of the above D

Question 2

A positive cross-price elasticity estimate between in-patient and out-patient services at a hospital would imply that the two are _______.

Accepted Answer

A)  normal goods 
B)  inferior goods 
C)  compliments 
D)  substitutes 
E)  unrelated 
A)  normal goods 
B)  inferior goods 
C)  compliments 
D)  substitutes 
E)  unrelated D

Question 3

As consumers purchase more medical care, the marginal utility per dollar spent on medical care increases.

Accepted Answer

A) True 
 B)False  False

Question 4

Which of the following might occur after acquiring health insurance due to moral hazard?

Accepted Answer

A)  A consumer visits a doctor more frequently. 
B)  A consumer washes his / her hands more frequently. 
C)  A consumer eats healthier. 
D)  All of the above 
E)  None of the above 
A)  A consumer visits a doctor more frequently. 
B)  A consumer washes his / her hands more frequently. 
C)  A consumer eats healthier. 
D)  All of the above 
E)  None of the above

Question 5

Larger deductible requirements decrease the risk of moral hazard.

Accepted Answer

A) True 
 B)False

Question 6

The _______ refers to the impact a lower price for medical care has on the real purchasing power of consumers.

Accepted Answer

A)  income effect 
B)  inflation rate 
C)  effective demand 
D)  substitution effect 
E)  nominal demand 
A)  income effect 
B)  inflation rate 
C)  effective demand 
D)  substitution effect 
E)  nominal demand

Question 7

A negative income elasticity of demand for out-patient services would imply that it is an inferior good.

Accepted Answer

A) True 
 B)False

Question 8

Time costs of acquiring medical care are considered _______.

Accepted Answer

A)  direct non-medical costs 
B)  direct medical costs 
C)  opportunity costs 
D)  both a and b 
E)  both a and c 
A)  direct non-medical costs 
B)  direct medical costs 
C)  opportunity costs 
D)  both a and b 
E)  both a and c

Question 9

Consumer demand for medical care is considered a _______ demand, as it depends on the consumer's demand for good health.

Accepted Answer

A)  absolute 
B)  derived 
C)  relative 
D)  supplemental 
E)  supply-side 
A)  absolute 
B)  derived 
C)  relative 
D)  supplemental 
E)  supply-side

Question 10

Since the demand for medical care is derived from the demand for good health, an increase in income will decrease the demand for medical care.

Accepted Answer

A) True 
 B)False

Question 11

When will the marginal utility per dollar spent on medical care equal the marginal utility per dollar spent on entertainment for a consumer?

Accepted Answer

A)  This will only occur when the consumer becomes ill. 
B)  This will only occur when the consumer is healthy. 
C)  This will only occur if the consumer seeks to maximize utility. 
D)  This will only occur if the consumer does not enjoy most forms of entertainment. 
E)  This will never occur. 
A)  This will only occur when the consumer becomes ill. 
B)  This will only occur when the consumer is healthy. 
C)  This will only occur if the consumer seeks to maximize utility. 
D)  This will only occur if the consumer does not enjoy most forms of entertainment. 
E)  This will never occur.

Question 12

The _______ refers to how much more or less of a product consumers buy when its price changes.

Accepted Answer

A)  intensive margin 
B)  extensive margin 
C)  nominal demand 
D)  effective demand 
E)  fuzzy demand 
A)  intensive margin 
B)  extensive margin 
C)  nominal demand 
D)  effective demand 
E)  fuzzy demand

Question 13

Demand for most medical services in the U.S. has been found to be inelastic.

Accepted Answer

A) True 
 B)False

Question 14

A _______ represents a fixed amount paid by the consumer that is independent of the market price or actual costs of medical care.

Accepted Answer

A)  deductible 
B)  loading charge 
C)  coinsurance rate 
D)  claim 
E)  copayment 
A)  deductible 
B)  loading charge 
C)  coinsurance rate 
D)  claim 
E)  copayment

Question 15

The _______ refers to how many more or fewer people buy a product when its price changes.

Accepted Answer

A)  intensive margin 
B)  extensive margin 
C)  nominal demand 
D)  effective demand 
E)  fuzzy demand 
A)  intensive margin 
B)  extensive margin 
C)  nominal demand 
D)  effective demand 
E)  fuzzy demand

Insurance _ the price for medical care, thereby _ the demand for it.

A positive cross-price elasticity estimate between in-patient and out-patient services at a hospital would imply that the two are _______.

As consumers purchase more medical care, the marginal utility per dollar spent on medical care increases.

Which of the following might occur after acquiring health insurance due to moral hazard?

Larger deductible requirements decrease the risk of moral hazard.

The _______ refers to the impact a lower price for medical care has on the real purchasing power of consumers.

A negative income elasticity of demand for out-patient services would imply that it is an inferior good.

Time costs of acquiring medical care are considered _______.

Consumer demand for medical care is considered a _______ demand, as it depends on the consumer's demand for good health.

Since the demand for medical care is derived from the demand for good health, an increase in income will decrease the demand for medical care.

When will the marginal utility per dollar spent on medical care equal the marginal utility per dollar spent on entertainment for a consumer?

The _______ refers to how much more or less of a product consumers buy when its price changes.

Demand for most medical services in the U.S. has been found to be inelastic.

A _______ represents a fixed amount paid by the consumer that is independent of the market price or actual costs of medical care.

The _______ refers to how many more or fewer people buy a product when its price changes.

Introduction

Health and Medical Care: an Economic Perspective

Cost and Benefit Analysis

Health Care Systems and Institutions

The Demand for Medical Insurance: Traditional and Managed Care Coverage

Medical Care Production and Costs

Structure, Conduct, Performance, and Market Analysis

Government, Health, and Medical Care

Government As Health Insurer

The Private Health Insurance Industry

The Physician Services Industry

The Hospital Services Industry

The Pharmaceutical Industry

The Long-Term Care Industry

Health Insurance Reform

Filters

Exam 5: The Demand for Medical Care

Insurance _______ the price for medical care, thereby _______ the demand for it.

A positive cross-price elasticity estimate between in-patient and out-patient services at a hospital would imply that the two are _______.

As consumers purchase more medical care, the marginal utility per dollar spent on medical care increases.

Which of the following might occur after acquiring health insurance due to moral hazard?

Larger deductible requirements decrease the risk of moral hazard.

The _______ refers to the impact a lower price for medical care has on the real purchasing power of consumers.

A negative income elasticity of demand for out-patient services would imply that it is an inferior good.

Time costs of acquiring medical care are considered _______.

Consumer demand for medical care is considered a _______ demand, as it depends on the consumer's demand for good health.

Since the demand for medical care is derived from the demand for good health, an increase in income will decrease the demand for medical care.

When will the marginal utility per dollar spent on medical care equal the marginal utility per dollar spent on entertainment for a consumer?

The _______ refers to how much more or less of a product consumers buy when its price changes.

Demand for most medical services in the U.S. has been found to be inelastic.

A _______ represents a fixed amount paid by the consumer that is independent of the market price or actual costs of medical care.

The _______ refers to how many more or fewer people buy a product when its price changes.

Introduction

Health and Medical Care: an Economic Perspective

Cost and Benefit Analysis

Health Care Systems and Institutions

The Demand for Medical Insurance: Traditional and Managed Care Coverage

Medical Care Production and Costs

Structure, Conduct, Performance, and Market Analysis

Government, Health, and Medical Care

Government As Health Insurer

The Private Health Insurance Industry

The Physician Services Industry

The Hospital Services Industry

The Pharmaceutical Industry

The Long-Term Care Industry

Health Insurance Reform

Filters

Insurance _ the price for medical care, thereby _ the demand for it.