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52.
Refer to the diagram. Physicians likely would argue that health care should be provided to
patients in
53. Which of the following is a supply factor in the health care market?
24-22
54. Health care costs have greatly increased in recent years in the United States. This fact
alone does not establish an overallocation of resources to health care, because
55.
Refer to the diagram, which shows the market for U.S. health care. Other things equal,
which of the following would shift the demand curve for medical care from D1 to D2?
56.
Refer to the diagram, which shows the market for U.S. health care. Other things equal,
which of the following would shift the supply curve for medical care from S1 to S2?
24-24
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
D. higher medical malpractice insurance premiums
57.
Refer to the diagram, which shows the market for U.S. health care. The problem of rapidly
rising medical care costs is best illustrated by the shifts of the demand and supply curves
from D1 to
24-25
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
Test Bank: I
Topi c: Why the Rapid Rise in Costs?
Type: Graph
58.
Refer to the diagram, which shows the market for U.S. health care. Other things equal,
which of the following would shift the demand curve for medical care from D2 to D1?
59.
Refer to the diagram, which shows the market for U.S. health care. Other things equal,
which of the following would shift the supply curve for medical care from S2 to S1?
60. If an individual is less careful about avoiding accidents or illness because she has
health insurance, this is an example of
24-27
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
AACSB: Knowledge Application
A c c e s si b i l i ty : Keyboard Navigation
Blooms: Remember
Difficulty: 01 Easy
Learning Objective: 24-04 List the demand and supply factors explaining rising health
care costs.
Test Bank: I
Topi c: Why the Rapid Rise in Costs?
61. If the existence of health insurance increases one's incentive to use the health care
system more intensively, this is an illustration of
62. Sam decides to join the Gigantic State University's rugby team when he learns that his
health insurance will pay for any subsequent injury. This illustrates
63. The availability of health insurance tends to
64. It is generally agreed that in the long run the cost of private health insurance provided
by employers is
65. Other things equal, increased emphasis on providing the best possible medical care for
all, regardless of income, will
24-29
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
AACSB: Knowledge Application
A c c e s si b i l i ty : Keyboard Navigation
Blooms: Remember
Difficulty: 01 Easy
Learning Objective: 24-04 List the demand and supply factors explaining rising health
care costs.
Test Bank: I
Topi c: Why the Rapid Rise in Costs?
66. 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?
67. Health care costs have tended to rise more rapidly in the United States than in Canada
because
24-30
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
Test Bank: I
Topi c: Why the Rapid Rise in Costs?
68.
Refer to the demand and supply diagram, which relates to the health care market. Without
health insurance, the equilibrium price and quantity of health care would be
69.
Refer to the demand and supply diagram, which relates to the health care market. If
suppliers provide the quantity of health care demanded and insurance pays one-half of the
equilibrium price of the health care good or service depicted, the immediate price to the
consumer and the quantity of health care consumed would be best represented by
70.
Refer to the demand and supply diagram, which relates to the health care market. If
suppliers provide whatever quantity of health care is demanded, health care insurance
causes
24-33
71.
Refer to the demand and supply diagram, which relates to the health care market. The
efficiency loss caused by the availability of health insurance is shown by area
72.
Quantity Supplied
Price
Quantity Demanded
12,000
$5,000
2,000
10,000
4,000
4,000
7,000
3,000
7,000
4,000
2,000
11,000
1,000
1,000
16,000
The table gives supply and demand data for a certain elective surgical procedure. Without
health insurance, the equilibrium price and quantity would be
73.
Quantity Supplied
Price
Quantity Demanded
12,000
$5,000
2,000
10,000
4,000
4,000
7,000
3,000
7,000
4,000
2,000
11,000
1,000
1,000
16,000
The table gives supply and demand data for a certain elective surgical procedure. If
suppliers provide the quantity of health care demanded and insurance pays two-thirds of the
equilibrium price, the immediate price to the consumer and quantity of health care
demanded would be
74.
Quantity Supplied
Price
Quantity Demanded
12,000
$5,000
2,000
10,000
4,000
4,000
7,000
3,000
7,000
4,000
2,000
11,000
1,000
1,000
16,000
The table gives supply and demand data for a certain elective surgical procedure. If
suppliers provide the quantity of health care demanded and insurance pays 50 percent of the
remaining equilibrium price after a $1,000 deductible is satisfied, the quantity of health
care demanded will be
75. Federal tax policy
24-36
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
B.
subsidizes health insurance and thereby increases the demand for health care.
C. subsidizes health insurance and thereby decreases the demand for health care.
D. corrects the overallocation of resources to the health care industry that would otherwise
exist.
76. A tax subsidy is involved in employer-financed health insurance because
77. Which of the following factors has contributed to rising health care prices in the United
States?
24-37
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
Learning Objective: 24-04 List the demand and supply factors explaining rising health
care costs.
Test Bank: I
Topi c: Why the Rapid Rise in Costs?
78. Insurance companies use deductibles and copayments to
79. Suppose you go to a doctor but your health insurance plan does not reimburse you
because you have not yet paid enough out of pocket for the year to qualify for insurance
benefits. This is an example of
80. Suppose you go to a doctor, but your health insurance plan reimburses you for only 80
percent of the bill. This is an example of
24-38
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
C. monopsony power.
D. a deferred benefit plan.
81. The two main types of managed-care organizations are
82. Health maintenance organizations (HMOs)
83. Preferred provider organizations (PPOs)
84. The main purpose of HMOs and PPOs is to
85. One of the main differences between PPOs and HMOs is that
24-40
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
A c c e s si b i l i ty : Keyboard Navigation
Blooms: Understand
Di f f i cu l ty : 02 Medium
Learning Objective: 24-05 Describe the cost-containment strategies that rely on altering
the financial incentives facing either patients or health service providers.
Test Bank: I
Topi c: Cost Containment: Altering Incentives
86. All of the following are designed to reduce health care expenses for consumers except
87. Which of the following is a law passed in the last 20 years relating to health care?
88. Health savings accounts (HSAs), implemented by the 2003 Medicare law,
