EXAM 1

Question 1

In 2018 spending on hospitals, doctors and other clinic services in the U.S. was $2.16 trillion, holding steady at _____________ of total health care spending

Answer 1

59%

Question 2

The U.S. health system is a complicated relationship among providers, consumers, and financiers of care that revolves around three concerns, EXCEPT:

Answer 2

Prestige

Question 3

TRUE/ FALSE. In the United States, 31% of the overall spending in health care is a result of administrative waste.

Answer 3

false

Question 4

On both the population and individual perspectives, the health status of the U.S. population is mediocre with increasing incidence and prevalence of the chronic disease across the life span and a relatively high mortality rate among ______________

Answer 4

infants

Question 5

TRUE/FALSE. Many of the determinants of individual health status are shaped by the community and environment in which the person lives

Answer 5

TRUE

Question 6

Which organization has defined health as “a complete state of physical, mental, and social well-being and not merely the absence of an illness or a disease”?

Answer 6

WHO

Question 7

The demand and supply functions for health intersect with one another to establish which of the following?

Answer 7

Market equilibrium

Question 8

Health economics is a field of economics that analyzes the behavior of which of the following in the healthcare economy?

Answer 8

Finances, producers, consumers, government

Question 9

Which of the following maximizes utility or satisfaction from consuming various amounts of goods and services given limited income and the prices of goods and services considered in a given period?

Answer 9

consumer

Question 10

In 2018 the USA spent $3.65 trillion that translates to $________ per person.

Answer 10

11,121

Question 11

Which of the following are characteristics of perfect competition?

Answer 11

• Many sellers possessing tiny market shares
• A homogenous product
• No barriers to entry
• Perfect consumer information

Question 12

Which of the following creates an incentive for new firms to enter an industry to obtain a share of the profits, thus driving the price down and inducing more goods and services to be produced?

Answer 12

Excess profit

Question 13

TRUE/FALSE. When applied to healthcare industries, many of the assumptions of microeconomic analysis and characteristics often fit extremely well?

Answer 13

False

Question 14

TRUE/FALSE Profit Maximization refers to a process that firms use to determine the most output given price levels that will yield the most return after production costs and the total cost outlay are taken into account

Answer 14

True

Question 15

Supply curve shifts because of

Answer 15

Price of inputs
Technology
Number of production

Question 16

The government can promote efficiency and equity in which of the following manners…

Answer 16

• Promoting positive externalities
• Providing public goods
• Enforcing antitrust laws
• Levying taxes

Question 17

Which piece of legislation prohibits independent physicians from discussing their pricing policies to prevent monopolistic practices such as price fixing?

Answer 17

SHERMAN ANTITRUST ACT

Question 18

TRUE/FALSE A firm producing pharmaceuticals dumps its waste in a river or pollutes the air is an example of External cost of production

Answer 18

True

Question 19

TRUE/FALSE In addition to their effects on individual health, cigarette smoking and alcohol consumption may also have negative effects on the rest of society in terms of passive smoking and antisocial behavior, which are not compensated for in the private market can cause External costs of consumption

Answer 19

TRUE

Question 20

Which of the following describe public goods

Answer 20

Non-rivalry and non-excludability

Question 21

TRUE/FALSE. In Monopolistic market the main distinguishing characteristic of this market model is that firms sell differentiated products.

Answer 21

true

Question 22

TRUE/FALSE. In Oligopoly market there may be a large number of firms in the industry, but there maybe other small firms who will be price takers, with limited market share.

Answer 22

true

Question 23

TRUE/FALSE In Monopoly market there is minimal barriers to entry to the market.

Answer 23

false

Question 24

TRUE/FALSE Health insurance market in United States is an example of Perfectly competitive market.

Answer 24

false

Question 25

What is health economics?

Answer 25

A branch of economics dealing with the provision, delivery, and use of healthcare goods and services.

Question 26

Definition of Health

Answer 26

a complete state of physical, mental, and social well-being and not merely the absence of disease or illness

Question 27

Public Goods

Answer 27

a commodity or service that is provided without profit to all members of a society by the gov

Question 28

Free rider problem

Answer 28

Individuals who are unwilling to pay for the goods and services if other people are willing to pay for them.

Question 29

Nonexcludability

Answer 29

individuals can obtain the benefits from consuming a good without paying for it.