LSUS MHA 710 ECONOMICS
EXAM 1
According to Adam Smith's terminology, the "invisible hand" refers
to: - ANSWERS-Market forces working through the price
mechanism.
Suppose you are a politician being criticized in a debate for your
commitment to reducing the growth of medical spending. Which of
the following is the most appropriate response? - ANSWERS-
Reducing wasteful heath care spending could provide additional
funding to the education sector.
Assuming that a market is perfectly competitive & in a state of
equilibrium, which of the following statements is always true when
the price changes? - ANSWERS-Social welfare decreases.
Assuming that providers will only accommodate patient desires up to
a point, what effect would a binding price ceiling have on the health
care market? - ANSWERS-Quantity of health care supplied would
fall.
Suppose you are a consultant advising the U.S. government on
reducing national health care spending. Assuming that providers will
accommodate patient desires, what advice could you offer concerning
the implementation of a price ceiling? - ANSWERS-Total spending
, may rise if providers intensify & create new technology for the
uncontrolled sector.
How different is medical care from other commodities? Arrow (1963)
based his thesis on a number of characteristics that contribute to the
unique nature of medical care. All of the following characteristics
were listed by Arrow, except: - ANSWERS-Preponderance of not-for-
profit providers.
Even in the U.S., approximately, what percent of medical care is
purchased through insurance, government programs or other third
party insurers? - ANSWERS-90
In the nation of Pavlova, a significant portion of the population suffers
from breathing difficulties later in life. Pavlova Medical produces the
only prescription drug that is effective in treating the condition.
Which of the following terms best describes the situation in the
market? - ANSWERS-Monopoly.
Which of the following is NOT a potential result of ever-increasing
health care pricing? - ANSWERS-Reduced incentives for innovation.
If price elasticity is known to be -0.15, what happens to quantity when
the price of services at Urban General falls by 10 percent? -
ANSWERS-Quantity demanded increases by 1.5 percent.
EXAM 1
According to Adam Smith's terminology, the "invisible hand" refers
to: - ANSWERS-Market forces working through the price
mechanism.
Suppose you are a politician being criticized in a debate for your
commitment to reducing the growth of medical spending. Which of
the following is the most appropriate response? - ANSWERS-
Reducing wasteful heath care spending could provide additional
funding to the education sector.
Assuming that a market is perfectly competitive & in a state of
equilibrium, which of the following statements is always true when
the price changes? - ANSWERS-Social welfare decreases.
Assuming that providers will only accommodate patient desires up to
a point, what effect would a binding price ceiling have on the health
care market? - ANSWERS-Quantity of health care supplied would
fall.
Suppose you are a consultant advising the U.S. government on
reducing national health care spending. Assuming that providers will
accommodate patient desires, what advice could you offer concerning
the implementation of a price ceiling? - ANSWERS-Total spending
, may rise if providers intensify & create new technology for the
uncontrolled sector.
How different is medical care from other commodities? Arrow (1963)
based his thesis on a number of characteristics that contribute to the
unique nature of medical care. All of the following characteristics
were listed by Arrow, except: - ANSWERS-Preponderance of not-for-
profit providers.
Even in the U.S., approximately, what percent of medical care is
purchased through insurance, government programs or other third
party insurers? - ANSWERS-90
In the nation of Pavlova, a significant portion of the population suffers
from breathing difficulties later in life. Pavlova Medical produces the
only prescription drug that is effective in treating the condition.
Which of the following terms best describes the situation in the
market? - ANSWERS-Monopoly.
Which of the following is NOT a potential result of ever-increasing
health care pricing? - ANSWERS-Reduced incentives for innovation.
If price elasticity is known to be -0.15, what happens to quantity when
the price of services at Urban General falls by 10 percent? -
ANSWERS-Quantity demanded increases by 1.5 percent.
