Question 1

The United States devotes about ______ percent of its gross domestic product to health care (2017) .

Accepted Answer

A)  5.2
B)  8.6
C)  15.3
D)  17.9E) A) and B)
F) All of the above

Question 2

The price elasticity of demand for health care is 0.2. This means that a 5 percent increase in price will induce a

Accepted Answer

A)  10 percent decrease in quantity demanded.
B)  5 percent decrease in quantity demanded.
C)  2.5 percent decrease in quantity demanded.
D)  1 percent decrease in quantity demanded.E) A) and D)
F) None of the above

Question 3

Which of the following would increase the supply of health care services?

Accepted Answer

A)  increased practice of defensive medicine
B)  more tax subsidies for consumers
C)  increases in physicians' productivity
D)  increases in health insurance coverageE) B) and C)
F) All of the above

Question 4

Since 1960, health care costs in the United States have risen absolutely but remained constant as a percentage of gross domestic product.

Accepted Answer

A) True 
 B)False

Question 5

Singapore encourages competition in its health care market by

Accepted Answer

A)  requiring hospitals to post prices for services and by government publishing hospital performance records.
B)  avoiding any government involvement in the health care market.
C)  operating government-run hospitals to compete directly with private hospitals.
D)  outsourcing all of its health care services to foreign providers.E) B) and C)
F) A) and D)

Question 6

Explain how unhealthy lifestyles contribute to increasing health care costs.

Accepted Answer

Substance abuse helps drive up health ca...

Question 7

Insurance tends to drive up health care costs by encouraging greater use of health care resources. Why has this occurred in the United States but not in Canada or the United Kingdom?

Accepted Answer

A)  There is no health care insurance in Canada or the United Kingdom.
B)  Canada and the United Kingdom use nonprice rationing to contain costs.
C)  Canada and the United Kingdom have better health care technology that allows them to achieve lower costs than the United States.
D)  Only private insurance creates an incentive to overuse health care resources.E) C) and D)
F) A) and D)

Question 8

The Patient Protection and Affordable Care Act (PPACA) of 2010 is designed to address a wide-ranging set of issues including the following, except

Accepted Answer

A)  the large portion of health spending supported by government insurance.
B)  the high and rising cost of health insurance and health care spending.
C)  the fact that tens of millions of Americans do not have health insurance.
D)  the inability of many people with preexisting conditions to obtain health insurance.E) B) and D)
F) All of the above

Question 9

Which of the following is a supply factor in the health care market?

Accepted Answer

A)  defensive medicine
B)  the aging of the population
C)  slow productivity growth in the health care industry
D)  asymmetric informationE) B) and D)
F) A) and B)

Question 10

Health insurance induces consumers to adopt less prevention and overconsumption of health care.

Accepted Answer

A) True 
 B)False

Question 11

There is a consensus among economists that the amount of resources allocated to the health care industry is optimal.

Accepted Answer

A) True 
 B)False

Question 12

Changes in the average age of the U.S. population over the past decade have decreased the demand for health care.

Accepted Answer

A) True 
 B)False

Question 13

Refer to the graph of a hypothetical market for health care. If there was not health insurance, the equilibrium price and quantity of health care would be

Accepted Answer

A)  $20 and 600 units.
B)  $40 and 450 units.
C)  $60 and 300 units.
D)  $80 and 450 units.E) B) and D)
F) B) and C)

Question 14

The table gives supply and demand data for a certain elective surgical procedure. Without health insurance, the equilibrium price and quantity would be

Accepted Answer

A)  $2,000 and 700.
B)  $3,000 and 7,000.
C)  $1,000 and 1,000.
D)  $2,000 and 4,000.E) A) and B)
F) All of the above

Question 15

Approximately how many workers are employed in the U.S. health care industry?

Accepted Answer

A)  713,800
B)  931,200
C)  12 million
D)  20 millionE) B) and C)
F) A) and D)

Question 16

The employer mandate of the PPACA requires that

Accepted Answer

A)  every firm must purchase health insurance for their full-time employees or pay a $2,000 fine per employee.
B)  every firm with 50 or more full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee.
C)  every firm with fewer than 50 full-time employees must purchase health insurance for their full-time employees or pay a $2,000 fine per employee.
D)  every firm with 500 or more employees must establish their own on-site medical facilities to provide employees with basic medical care.E) B) and D)
F) C) and D)

Question 17

In 2007, approximately what percentage of people in the United States with private health insurance received it as an employer-provided benefit?

Accepted Answer

A)  35
B)  50
C)  88
D)  95E) A) and B)
F) A) and C)

Question 18

What are the two main types of managed-care organizations (or systems)that are used to control health care costs?

Accepted Answer

Managed care organizations are being wid...

Question 19

The problem of asymmetric information is that

Accepted Answer

A)  neither health care buyers nor providers are well-informed.
B)  health care providers are well-informed, but buyers are not.
C)  the outcomes of many complex medical procedures cannot be predicted.
D)  insurance companies are well-informed, but policy purchasers are not.E) A) and D)
F) B) and C)

Question 20

The percentage of cost that an insured individual pays while the insurer pays the remainder would be considered

Accepted Answer

A)  copayments.
B)  deductibles.
C)  play-or-pay.
D)  fee for service.E) C) and D)
F) A) and C)

Exam 24: Health Care

Since 1960, health care costs in the United States have risen absolutely but remained constant as a percentage of gross domestic product.

Correct AnswerverifiedShow Answer

Refer to the graph of a hypothetical market for health care. If there was not health insurance, the equilibrium price and quantity of health care would be

Correct AnswerverifiedShow Answer

Singapore encourages competition in its health care market by

Correct AnswerverifiedShow Answer

Explain how unhealthy lifestyles contribute to increasing health care costs.

Correct AnswerverifiedSubstance abuse helps drive up health ca...View AnswerShow Answer

The problem of asymmetric information is that

Correct AnswerverifiedShow Answer

Approximately how many workers are employed in the U.S. health care industry?

Correct AnswerverifiedShow Answer

Which of the following would increase the supply of health care services?

Correct AnswerverifiedShow Answer

There is a consensus among economists that the amount of resources allocated to the health care industry is optimal.

Correct AnswerverifiedShow Answer

Which of the following is a supply factor in the health care market?

Correct AnswerverifiedShow Answer

The United States devotes about ______ percent of its gross domestic product to health care (2017) .

Correct AnswerverifiedShow Answer

The employer mandate of the PPACA requires that

Correct AnswerverifiedShow Answer

The table gives supply and demand data for a certain elective surgical procedure. Without health insurance, the equilibrium price and quantity would be

Correct AnswerverifiedShow Answer

The price elasticity of demand for health care is 0.2. This means that a 5 percent increase in price will induce a

Correct AnswerverifiedShow Answer

Insurance tends to drive up health care costs by encouraging greater use of health care resources. Why has this occurred in the United States but not in Canada or the United Kingdom?

Correct AnswerverifiedShow Answer

The Patient Protection and Affordable Care Act (PPACA) of 2010 is designed to address a wide-ranging set of issues including the following, except

Correct AnswerverifiedShow Answer

The percentage of cost that an insured individual pays while the insurer pays the remainder would be considered

Correct AnswerverifiedShow Answer

Health insurance induces consumers to adopt less prevention and overconsumption of health care.

Correct AnswerverifiedShow Answer

What are the two main types of managed-care organizations (or systems)that are used to control health care costs?

Correct AnswerverifiedManaged care organizations are being wid...View AnswerShow Answer

In 2007, approximately what percentage of people in the United States with private health insurance received it as an employer-provided benefit?

Correct AnswerverifiedShow Answer

Changes in the average age of the U.S. population over the past decade have decreased the demand for health care.

Correct AnswerverifiedShow Answer

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Substance abuse helps drive up health ca...
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Managed care organizations are being wid...
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