Reference no: EM13736522

1. What phrase best describes medical care spending in the United States?

a) Total spending of more than $2 trillion represents 17 percent of GDP and approximately $8,000 per capita.

b) Total spending of more than $1 trillion represents 14.8 percent of GDP and almost $6,000 per capita.

c) Total spending of less than $1 trillion represents less than 13 percent of GDP and almost $3,000 per capita.

d) Total spending is rising at double-digit rates and spending is soaring to over $5,000 per capita.

e) Total spending is under control and represents a shrinking percentage of GDP. 

2. Which of the following will not change the demand for office visits to the physician?

a) unusually cold and damp weather during the winter.

b) a change in the price of an office visit.

c) layoffs at the local plant causing a decrease in the number of people with health insurance in the community.

d) television advertising by drug manufacturers to promote a new over-the-counter influenza treatment.

e) they all change the demand for office visits

3. Supply curves are positively-sloped because of

a) Inefficient allocation of resources.

b) The law of diminishing marginal returns.

c) Economies of scale.

d) Self-interested suppliers seeking economic profit.

e) All of the above

4. The dead-weight loss from an excise tax

a) Is greater if demand is perfectly inelastic.

b) Is caused by a shift in consumer preferences when the tax is raised.

c) Is the lost surplus that results from higher prices and lower output resulting from the tax?

d) Is of little concern to policy makers since all excise taxes are “sin” taxes.