BU.555.710
Applied & Behavioral Economics in
HC
LATEST EXAM READINESS
GUIDE
Q&S
©2024/2025
,1. Question: What is the primary economic rationale
behind health insurance?
- A) To increase healthcare profits
- B) To spread risk and reduce financial uncertainty
- C) To ensure universal healthcare access
- D) To decrease government healthcare spending
Correct Answer: B) To spread risk and reduce financial
uncertainty
Rationale: Health insurance pools risk among many
insured individuals, reducing financial uncertainty for any
one person. This helps individuals manage high and
unpredictable healthcare costs.
2. Question: In behavioral economics, which concept
explains why patients might prefer a treatment with
immediate benefits over one with long-term benefits?
- A) Loss aversion
- B) Hyperbolic discounting
- C) Framing effect
- D) Overconfidence bias
Correct Answer: B) Hyperbolic discounting
Rationale: Hyperbolic discounting refers to the
tendency to choose smaller, immediate rewards over larger,
later ones, reflecting impulsivity and short-term bias.
3. Question: What is the significance of "moral hazard" in
healthcare economics?
- A) Patients bypassing necessary treatments
©2024/2025
, - B) Overutilization of healthcare services due to
insurance coverage
- C) Insurance companies denying claims
- D) Providers increasing costs due to competition
Correct Answer: B) Overutilization of healthcare
services due to insurance coverage
Rationale: Moral hazard occurs when individuals
consume more healthcare services than necessary
because they do not bear the full cost due to insurance
coverage.
4. Question: Which policy is aimed at reducing healthcare
costs through the promotion of primary care and preventive
services?
- A) Fee-for-service
- B) Capitation payment
- C) Value-based care
- D) Catastrophic health insurance
Correct Answer: C) Value-based care
Rationale: Value-based care incentivizes healthcare
providers to focus on delivering quality care and preventive
services to reduce long-term costs.
5. Question: In health economics, what is a common
consequence of adverse selection?
- A) Improved patient outcomes
- B) Efficient health insurance markets
- C) Higher premiums and reduced market stability
- D) Greater access to specialist care
Correct Answer: C) Higher premiums and reduced
©2024/2025
Applied & Behavioral Economics in
HC
LATEST EXAM READINESS
GUIDE
Q&S
©2024/2025
,1. Question: What is the primary economic rationale
behind health insurance?
- A) To increase healthcare profits
- B) To spread risk and reduce financial uncertainty
- C) To ensure universal healthcare access
- D) To decrease government healthcare spending
Correct Answer: B) To spread risk and reduce financial
uncertainty
Rationale: Health insurance pools risk among many
insured individuals, reducing financial uncertainty for any
one person. This helps individuals manage high and
unpredictable healthcare costs.
2. Question: In behavioral economics, which concept
explains why patients might prefer a treatment with
immediate benefits over one with long-term benefits?
- A) Loss aversion
- B) Hyperbolic discounting
- C) Framing effect
- D) Overconfidence bias
Correct Answer: B) Hyperbolic discounting
Rationale: Hyperbolic discounting refers to the
tendency to choose smaller, immediate rewards over larger,
later ones, reflecting impulsivity and short-term bias.
3. Question: What is the significance of "moral hazard" in
healthcare economics?
- A) Patients bypassing necessary treatments
©2024/2025
, - B) Overutilization of healthcare services due to
insurance coverage
- C) Insurance companies denying claims
- D) Providers increasing costs due to competition
Correct Answer: B) Overutilization of healthcare
services due to insurance coverage
Rationale: Moral hazard occurs when individuals
consume more healthcare services than necessary
because they do not bear the full cost due to insurance
coverage.
4. Question: Which policy is aimed at reducing healthcare
costs through the promotion of primary care and preventive
services?
- A) Fee-for-service
- B) Capitation payment
- C) Value-based care
- D) Catastrophic health insurance
Correct Answer: C) Value-based care
Rationale: Value-based care incentivizes healthcare
providers to focus on delivering quality care and preventive
services to reduce long-term costs.
5. Question: In health economics, what is a common
consequence of adverse selection?
- A) Improved patient outcomes
- B) Efficient health insurance markets
- C) Higher premiums and reduced market stability
- D) Greater access to specialist care
Correct Answer: C) Higher premiums and reduced
©2024/2025
