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1 |  |  In the long run, higher costs of employer-provided private health insurance: |
|  | A) | reduce the growth of both wages and total compensation of workers |
|  | B) | reduce the growth of wages but not total compensation of workers |
|  | C) | reduce business profits, but not total compensation of workers |
|  | D) | reduce business profits and total compensation of workers |
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2 |  |  The U.S. health care market is characterized by all of the following, except: |
|  | A) | asymmetric information between patients and physicians |
|  | B) | price-elastic demand for health care services |
|  | C) | price distortions created by third-party payment systems |
|  | D) | positive externalities |
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3 |  |  The "play or pay" health care reform concept has been criticized because it would likely: |
|  | A) | reduce the incentive for firms to provide basic health insurance |
|  | B) | increase the waiting time to receive certain medical treatments and tests |
|  | C) | reduce the growth of wages and increase unemployment |
|  | D) | reduce overall quality of care |
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4 |  |  An increase in the price of health care services will: |
|  | A) | increase spending on health care because demand is price inelastic |
|  | B) | increase spending on health care because demand is price elastic |
|  | C) | increase spending on health care because demand is income elastic |
|  | D) | decrease spending on health care because supply is price elastic |
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5 |  |  Which of the following is a common element of health maintenance organizations, preferred provider organizations, and Medicare's diagnosis-related-group system? All of them: |
|  | A) | restrict a consumer's choice of physician |
|  | B) | provide prescription drug benefits |
|  | C) | compensate physicians on a fee-for-service basis |
|  | D) | create incentives for health providers to contain costs |
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6 |  |  Critics argue that a system of national health insurance would: |
|  | A) | increase the number of doctors beyond the point of MB = MC |
|  | B) | reduce or remove a consumer's right to choose a physician |
|  | C) | increase government ownership of hospitals, clinics, and nursing homes, thereby raising their cost |
|  | D) | increase the waiting time for many medical services and procedures |
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7 |  |  A system of national health insurance would likely do all the following except: |
|  | A) | retain the right of consumers to choose their own physicians |
|  | B) | encourage the hiring of part-time and temporary employees as a way to avoid costs |
|  | C) | increase waiting time for certain medical procedures |
|  | D) | increase government bureaucracy |
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8 |  |  By lowering the consumer's perceived price of a particular medical procedure, the effect of medical insurance is to: |
|  | A) | shift the demand curve for the procedure to the left |
|  | B) | reduce the total number of the procedures provided |
|  | C) | move downward and to the right along the demand curve for the procedure |
|  | D) | move downward and to the left along the supply curve for the procedure |
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9 |  |  In 2004, approximately 16% of the U.S. population was without medical insurance for the entire year. |
|  | A) | True |
|  | B) | False |
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10 |  |  As a percentage of GDP, medical spending is approximately: |
|  | A) | 16% and rising |
|  | B) | 8% and rising |
|  | C) | 12% and falling |
|  | D) | 18% and falling |
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