PHLT 412 Exam 3 Questions With
Answers 100% Solved
What is economics? - ANSWER Production, distribution, and consumption of
resources
Why do we need to study economics? - ANSWER How to allocate resources to
maximize the best result for the most amount of people
How can economics be used in policy making? - ANSWER Policy makers make
important decisions for citizens so they must focus on what they can do to
change someones mindset and behavior
T/F: Economists believe that people are rational actors who will never purposely
choose to make themselves worse off - ANSWER True
T/F: People seek to minimize utility - ANSWER False
What economic decisions need to be made? Why? - ANSWER Due to the scarcity
of resources, decisions need to be made about the production, distribution, and
consumption of health care resources with regards to individual preference and
efficiency
How can we analyze utility? - ANSWER Satisfaction can increase as resources
increase but at some point in time, that satisfaction will go down (diminishing
marginal utility)
What is meant by a scarce resource? - ANSWER Finite amount of healthcare
goods, personnel and capital inputs
What is demand? - ANSWER How many people want the item
The quantity of goods and services that a consumer is willing and able to
purchase over a specified time
What are common demand shifters? - ANSWER Price of the original good, price
of a substitute good, and price of a complementary good
Income
, Quality (actual or perceived)
Physical profile of consumer
What is demand elasticity? - ANSWER The percentage change in the quantity
demanded resulting from a 1% change in price or income
If a product is elastic to demand... - ANSWER A change in price or income will
result in an equivalent or greater change in demand
Very sensitive to price change (greater than 1)
If a product is inelastic to demand... - ANSWER The demand for the good is not
sensitive to a change in price/income
Smaller than 1
Health insurance acts as a _____ between the consumer and cost of health care
goods and services - ANSWER Buffer
Goods and services cost the consumer ___ than the charged price because of
the presence of health insurance - ANSWER Less
What is moral hazard? - ANSWER Because a consumer does not pay the full cost
of a good, the consumer may purchase more goods than he would otherwise
purchase without insurance
The unnecessary use of health care services - patients use more just because its
a low price or free
What is supply in regards to insurance? - ANSWER The amount of goods and
services that producers are able and willing to sell at a given price over a given
period of time
What are common supply shifters? - ANSWER Input costs
Sale price
Number of sellers
Change in technology
What is supply elasticity? - ANSWER The % change in quantity supplied resulting
from a 1% increase in the price of buying the good
If a product is elastic to supply... - ANSWER A change in price will result in an
equivalent or greater change in supply
Answers 100% Solved
What is economics? - ANSWER Production, distribution, and consumption of
resources
Why do we need to study economics? - ANSWER How to allocate resources to
maximize the best result for the most amount of people
How can economics be used in policy making? - ANSWER Policy makers make
important decisions for citizens so they must focus on what they can do to
change someones mindset and behavior
T/F: Economists believe that people are rational actors who will never purposely
choose to make themselves worse off - ANSWER True
T/F: People seek to minimize utility - ANSWER False
What economic decisions need to be made? Why? - ANSWER Due to the scarcity
of resources, decisions need to be made about the production, distribution, and
consumption of health care resources with regards to individual preference and
efficiency
How can we analyze utility? - ANSWER Satisfaction can increase as resources
increase but at some point in time, that satisfaction will go down (diminishing
marginal utility)
What is meant by a scarce resource? - ANSWER Finite amount of healthcare
goods, personnel and capital inputs
What is demand? - ANSWER How many people want the item
The quantity of goods and services that a consumer is willing and able to
purchase over a specified time
What are common demand shifters? - ANSWER Price of the original good, price
of a substitute good, and price of a complementary good
Income
, Quality (actual or perceived)
Physical profile of consumer
What is demand elasticity? - ANSWER The percentage change in the quantity
demanded resulting from a 1% change in price or income
If a product is elastic to demand... - ANSWER A change in price or income will
result in an equivalent or greater change in demand
Very sensitive to price change (greater than 1)
If a product is inelastic to demand... - ANSWER The demand for the good is not
sensitive to a change in price/income
Smaller than 1
Health insurance acts as a _____ between the consumer and cost of health care
goods and services - ANSWER Buffer
Goods and services cost the consumer ___ than the charged price because of
the presence of health insurance - ANSWER Less
What is moral hazard? - ANSWER Because a consumer does not pay the full cost
of a good, the consumer may purchase more goods than he would otherwise
purchase without insurance
The unnecessary use of health care services - patients use more just because its
a low price or free
What is supply in regards to insurance? - ANSWER The amount of goods and
services that producers are able and willing to sell at a given price over a given
period of time
What are common supply shifters? - ANSWER Input costs
Sale price
Number of sellers
Change in technology
What is supply elasticity? - ANSWER The % change in quantity supplied resulting
from a 1% increase in the price of buying the good
If a product is elastic to supply... - ANSWER A change in price will result in an
equivalent or greater change in supply
