Question 1

Many economists consider medical care a superior good. Which of the following statements is true regarding a superior good?

Accepted Answer

Superior goods are characterized by an income elasticity of demand greater than one, meaning that as consumer income increases, a larger percentage of that income is spent on these goods.

Question 2

Health insurance features that tend to reduce moral hazard include

Accepted Answer

Deductibles, coinsurance, and copayments are all features that require the insured to pay a portion of their healthcare costs, which can discourage overutilization of healthcare services and thus reduce moral hazard.

Question 3

The top ten causes of death in the United States in 2010 included all of the following but

Accepted Answer

AIDS was not among the top ten causes of death in the United States in 2010.

Question 4

The accompanying diagram depicts the relationship between health status and medical care spending for a particular country. Which of the following statements is true?

Accepted Answer

The answer of The accompanying diagram depicts the relationship between...

Question 5

McKeown's 1976) research attributed the majority of the secular decline in mortality rates in Europe and North America to

Accepted Answer

McKeown's research emphasized that the majority of the decline in mortality rates was due to improvements in nutrition and living conditions, rather than medical advancements or public health measures.

Question 6

Suppose the recipient of a kidney transplant has stated that she would prefer 5 years of perfect health to the 10 years she expects to live with her transplant. For this person, each of her remaining 10 years of life has a QALY value of

Accepted Answer

The answer of Suppose the recipient of a kidney transplant...

Question 7

A critical assumption in the model of demand and supply is the independence of demand and supply curves. If the two are not independent, a shift in the supply curve can lead to a shift in the demand curve referred to as

Accepted Answer

Supplier-induced demand occurs when changes in supply influence demand, indicating a lack of independence between the two curves.

Question 8

The RAND Health Insurance Study

Accepted Answer

The RAND Health Insurance Study was a large-scale, controlled experiment conducted in the United States to understand the effects of different levels of health insurance coverage on medical care usage and health outcomes.

Question 9

If health care spending is already on the flat-of-the-curve, it may not be possible to buy improved health status by increasing spending. In this situation, the best way to improve health status may be to

Accepted Answer

Improving lifestyle decisions can have a significant impact on health status, especially when additional spending on healthcare does not yield better outcomes.

Question 10

The concept quality-adjusted life year QALY)

Accepted Answer

QALY is a measure used to evaluate the value for money of medical interventions, particularly in government-run programs with fixed budgets, and is extensively used in Europe for resource allocation decisions.

Question 11

Factors affecting medical care demand include

Accepted Answer

All the listed factors—health status, demographic characteristics, economic standing, and physician factors—affect the demand for medical care.

Question 12

The following diagram depicts the market for physicians' services that is originally in equilibrium at point a with demand and supply at D₀ and S₀. As physician supply increases from S₀ to S₁, a concurrent shift in demand from D₀ to D₁

Accepted Answer

The answer of The following diagram depicts the market for...

Question 13

Health care that actually harms the patient, such as an adverse reaction to a prescription drug is called

Accepted Answer

Iatrogenic disease refers to any condition that is caused by medical treatment or diagnostic procedures, including adverse reactions to prescription drugs.

Question 14

The number one cause of death in the United States in 1980 was

Accepted Answer

Heart disease was the leading cause of death in the United States in 1980, as it has been for many years.

Question 15

A physician's ability to induce demand is greatly enhanced when

Accepted Answer

When patients have difficulty gathering and processing information, they rely more on the physician's expertise and recommendations, which can enhance the physician's ability to induce demand for certain treatments or services.

Quiz 5: The Demand for Health and Medical Care