Question 1

About how many people were employed in the U.S.health care industry in 2014?

Accepted Answer

A)  5 million
B)  12 million
C)  34 million
D)  42 millionE) None of the above
F) A) and D)

Question 2

(Consider This)  Which of the following was a major objective of the Health Information Technology for Economic and Clinical Health Act?

Accepted Answer

A)  more accurate records so health care providers could increase billings
B)  equip all households with personal medical devices to send real-time health symptoms to health care providers
C)  identify potential cost savings by detecting excessive procedures and medications
D)  all of theseE) A) and B)
F) A) and C)

Question 3

Which of the following was not an objection raised by opponents of the Patient Protection and Affordable Care Act?

Accepted Answer

A)  The revenue generated by the new taxes in the PPACA would be insufficient to cover costs of the program.
B)  The PPACA moves the United States closer to creating a national health insurance system with nonprice rationing of health care.
C)  The subsidies would lead to higher prices and increased consumption of health care.
D)  The percentage of health care spending coming directly out of consumers' pockets would increase.E) B) and C)
F) A) and B)

Question 4

When the supplier, not the buyer, of health care services makes most of the decisions about the amount and type of health care to be provided, there is

Accepted Answer

A)  a moral hazard in the health care market.
B)  asymmetric information in the health care market.
C)  a lack of medical ethics in the health care market.
D)  a need for Medicare in the health care market.E) A) and B)
F) A) and C)

Question 5

Most industrialized countries emphasize private health insurance paid by employers, to provide coverage for most workers in each nation.

Accepted Answer

A) True 
 B)False

Question 6

The availability of health insurance tends to

Accepted Answer

A)  decrease the quantity of health care demanded and cause an underallocation of resources to the health care industry.
B)  increase the quantity of health care demanded and cause an underallocation of resources to the health care industry.
C)  increase the quantity of health care demanded and cause an overallocation of resources to the health care industry.
D)  decrease the quantity of health care demanded and cause an overallocation of resources to the health care industry.E) B) and D)
F) All of the above

Question 7

The table shows the hypothetical demand and supply schedule for health care.With insurance paying two-thirds of the cost of health care, there would be a resulting allocative

Accepted Answer

A)  efficiency because, at 500 units, the marginal cost to society of $400 equals the marginal benefit of $400.
B)  efficiency because, at 700 units, the marginal cost to society is $200 and the marginal benefit is $600.
C)  inefficiency because, at 700 units, the marginal cost to society is $600 and the marginal benefit is $200.
D)  inefficiency because, at 700 units, the marginal cost to society is $400 and the marginal benefit is $200.E) C) and D)
F) B) and D)

Question 8

If labor productivity in the health care industry rises very slowly relative to wages and salaries in the industry, this would tend to

Accepted Answer

A)  increase the demand for health care.
B)  decrease the demand for health care.
C)  increase the supply of health care.
D)  increase the cost of health care.E) B) and C)
F) A) and D)

Question 9

What was the primary goal of the proponents of the Patient Protection and Affordable Care Act?

Accepted Answer

A)  improve the quality of care by reducing medical malpractice
B)  reduce health care costs in the United States by 50 percent
C)  make all U.S.health care publically (government)  provided
D)  extend health insurance coverage to all AmericansE) A) and B)
F) B) and C)

Question 10

Federal tax policy

Accepted Answer

A)  treats employer health insurance premiums as taxable income.
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.E) None of the above
F) B) and C)

Question 11

Insurance companies use deductibles and copayments to control increases in the amount of health care demanded.

Accepted Answer

A) True 
 B)False

Question 12

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

Accepted Answer

A)  the benefits of health care have also greatly increased in recent years.
B)  rising medical care prices have inflated health care costs.
C)  the marginal cost of health care exceeds the average total cost of health care.
D)  negative externalities sometimes result from additional health care spending.E) All of the above
F) B) and C)

Question 13

Major criticisms against the Patient Protection and Affordable Care Act (PPACA)  do not include which of the following arguments?

Accepted Answer

A)  It will lead to greater inefficiencies in health care, and overconsumption might even increase.
B)  It is very costly, and the revenue sources cited in the act will not be sufficient to cover future expenses.
C)  It still does not cover everyone in the nation, and there will still be significant numbers of Americans left uninsured.
D)  It might be the first step toward a socialized health insurance system where market forces will have no role in rationing health care.E) C) and D)
F) All of the above

Question 14

If an individual is less careful about avoiding accidents or illness because she has health insurance, this is an example of

Accepted Answer

A)  the free-rider problem.
B)  the moral hazard problem.
C)  the adverse selection problem.
D)  the Coase theorem.E) All of the above
F) None of the above

Question 15

About three-fourths of all health care costs are paid out of pocket by patients.Topic: Limited Access
Topic: The Health Care Industry

Accepted Answer

A) True 
 B)False

Question 16

Attempts to alter incentives and contain health care costs include the following, except

Accepted Answer

A)  imposing a copayment or a deductible.
B)  adopting managed-care systems, such as PPOs and HMOs.
C)  universal coverage.
D)  diagnosis-related groups (DRGs)  of Medicare.E) A) and D)
F) A) and C)

Question 17

Some low-income workers are not covered by Medicaid because of the income that they are earning from their jobs.

Accepted Answer

A) True 
 B)False

Question 18

The rising prices, quantities, and costs of health care in the U.S.are the result of

Accepted Answer

A)  demand for health care increasing faster than supply.
B)  supply of health care decreasing.
C)  supply of health care decreasing faster than demand.
D)  supply of health care decreasing coupled with demand increasing.E) None of the above
F) A) and B)

Question 19

The moral hazard problem created by health insurance induces consumers to underconsume health care.

Accepted Answer

A) True 
 B)False

Question 20

The price elasticity of demand for health care is

Accepted Answer

A)  perfectly inelastic.
B)  relatively inelastic.
C)  relatively elastic.
D)  perfectly elastic.E) A) and B)
F) None of the above

Exam 24: Health Care

Which of the following was not an objection raised by opponents of the Patient Protection and Affordable Care Act?

Correct AnswerverifiedShow Answer

The moral hazard problem created by health insurance induces consumers to underconsume health care.

Correct AnswerverifiedShow Answer

About how many people were employed in the U.S.health care industry in 2014?

Correct AnswerverifiedShow Answer

(Consider This) Which of the following was a major objective of the Health Information Technology for Economic and Clinical Health Act?

Correct AnswerverifiedShow Answer

If an individual is less careful about avoiding accidents or illness because she has health insurance, this is an example of

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

What was the primary goal of the proponents of the Patient Protection and Affordable Care Act?

Correct AnswerverifiedShow Answer

The rising prices, quantities, and costs of health care in the U.S.are the result of

Correct AnswerverifiedShow Answer

Attempts to alter incentives and contain health care costs include the following, except

Correct AnswerverifiedShow Answer

The availability of health insurance tends to

Correct AnswerverifiedShow Answer

About three-fourths of all health care costs are paid out of pocket by patients.Topic: Limited Access Topic: The Health Care Industry

Correct AnswerverifiedShow Answer

When the supplier, not the buyer, of health care services makes most of the decisions about the amount and type of health care to be provided, there is

Correct AnswerverifiedShow Answer

Most industrialized countries emphasize private health insurance paid by employers, to provide coverage for most workers in each nation.

Correct AnswerverifiedShow Answer

Some low-income workers are not covered by Medicaid because of the income that they are earning from their jobs.

Correct AnswerverifiedShow Answer

Major criticisms against the Patient Protection and Affordable Care Act (PPACA) do not include which of the following arguments?

Correct AnswerverifiedShow Answer

If labor productivity in the health care industry rises very slowly relative to wages and salaries in the industry, this would tend to

Correct AnswerverifiedShow Answer

The table shows the hypothetical demand and supply schedule for health care.With insurance paying two-thirds of the cost of health care, there would be a resulting allocative

Correct AnswerverifiedShow Answer

Insurance companies use deductibles and copayments to control increases in the amount of health care demanded.

Correct AnswerverifiedShow Answer

Federal tax policy

Correct AnswerverifiedShow Answer

The price elasticity of demand for health care is

Correct AnswerverifiedShow Answer

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