Question 1

Farm legislation has historically tried to increase farm income by:

Accepted Answer

A) guaranteeing a minimum price to farmers. 
B) imposing limits on production. 
C) insulating farmers from fluctuations in prices. 
D) doing all of the above. 
A) guaranteeing a minimum price to farmers. 
B) imposing limits on production. 
C) insulating farmers from fluctuations in prices. 
D) doing all of the above.

Question 2

Third-party payer systems for health-care services include payments made by:

Accepted Answer

A) doctors. 
B) patients. 
C) hospitals. 
D) government. 
A) doctors. 
B) patients. 
C) hospitals. 
D) government.

Question 3

The Oregon Plan for the provision of health care to people living below the poverty line generally increased the number and type of procedures for which they were eligible.

Accepted Answer

A) True 
 B)False

Question 4

All health insurance plans charge the same and require subscribers to pay the same percentage of the costs of health care they consume.

Accepted Answer

A) True 
 B)False

Question 5

Technological improvements in the health-care industry have been a primary factor in the increase in health-care costs.

Accepted Answer

A) True 
 B)False

Question 6

Rent controls:

Accepted Answer

A) almost always help low-income families find low-cost housing. 
B) often help high-income families. 
C) cause the quantity supplied to exceed the quantity demanded. 
D) result in all of the above. 
A) almost always help low-income families find low-cost housing. 
B) often help high-income families. 
C) cause the quantity supplied to exceed the quantity demanded. 
D) result in all of the above.

Question 7

-(Exhibit: The Market for Health Care)Based on the exhibit and assuming that there are no third-party payers, the:

Accepted Answer

A) equilibrium price for health-care services is P2. 
B) equilibrium quantity is Q2. 
C) total amount spent on health-care services at the equilibrium price is OP3BQ2. 
D) equilibrium price for health-care services is P1. 
A) equilibrium price for health-care services is P2. 
B) equilibrium quantity is Q2. 
C) total amount spent on health-care services at the equilibrium price is OP3BQ2. 
D) equilibrium price for health-care services is P1.

Question 8

A cost that farm subsidies and price floors imposes on the rest of the economy is:

Accepted Answer

A) excessively mobile farm resources. 
B) higher consumer commodity prices. 
C) less government-funded agricultural research. 
D) efficient farmers that leave the farming industry. 
A) excessively mobile farm resources. 
B) higher consumer commodity prices. 
C) less government-funded agricultural research. 
D) efficient farmers that leave the farming industry.

Question 9

In 1997, nearly _______ percent of U.S.households owned a computer.

Accepted Answer

A) 10 
B) 20 
C) 40 
D) 70 
A) 10 
B) 20 
C) 40 
D) 70

Question 10

Most firms in the United States today are:

Accepted Answer

A) sole proprietorships and partnerships. 
B) owned by government. 
C) corporations. 
D) owned by shareholders. 
A) sole proprietorships and partnerships. 
B) owned by government. 
C) corporations. 
D) owned by shareholders.

Question 11

-(Exhibit: Third-party payers)At a price of $60 with a third party payer, the total cost of health-care services compared to the price that would prevail if there were no third-party payers has:

Accepted Answer

A) decreased from $180 million to $80 million. 
B) increased from $80 million to $180 million. 
C) decreased from $180 million to $80 million, and consumers pay $60 million 
D) increased to $180 million, and insurance pays $60 million. 
A) decreased from $180 million to $80 million. 
B) increased from $80 million to $180 million. 
C) decreased from $180 million to $80 million, and consumers pay $60 million 
D) increased to $180 million, and insurance pays $60 million.

Question 12

-(Exhibit: Third-Party Payers)Based on the exhibit, and assuming there are no third-party payers:

Accepted Answer

A) the equilibrium quantity is 3 million physician office visits per week. 
B) the equilibrium quantity is 2 million physician office visits per week. 
C) the total amount spent on physician office visits at the equilibrium price is $180 million. 
D) he equilibrium quantity is 1 million physician office visits per week. 
A) the equilibrium quantity is 3 million physician office visits per week. 
B) the equilibrium quantity is 2 million physician office visits per week. 
C) the total amount spent on physician office visits at the equilibrium price is $180 million. 
D) he equilibrium quantity is 1 million physician office visits per week.

Question 13

The downside to helping farmers through price supports and output restrictions has been that:

Accepted Answer

A) consumers pay higher prices for food. 
B) citizens pay higher taxes to support the costs of the program. 
C) most federal subsidies help the rich farmers, not the poor. 
D) all of the above. 
A) consumers pay higher prices for food. 
B) citizens pay higher taxes to support the costs of the program. 
C) most federal subsidies help the rich farmers, not the poor. 
D) all of the above.

Question 14

Economists classify health care as:

Accepted Answer

A) an inferior good. 
B) a normal good. 
C) a good with many close substitutes. 
D) a good whose quantity changes considerably with a change in price. 
A) an inferior good. 
B) a normal good. 
C) a good with many close substitutes. 
D) a good whose quantity changes considerably with a change in price.

Question 15

-(Exhibit: Rent Controls)Without rent controls, the equilibrium rent is _______ and the equilibrium quantity is _______ .

Accepted Answer

A) Rent2; Q1  
B) Rent1; Q1  
C) Rent2; Q2  
D) Rent3; Q3  
A) Rent2; Q1  
B) Rent1; Q1  
C) Rent2; Q2  
D) Rent3; Q3

Question 16

Eliminating third-party payer systems is most likely to ________ the quantity of health care ________.

Accepted Answer

A) increase; demanded 
B) decrease; demanded 
C) have no effect on; demanded 
D) increase; supplied 
A) increase; demanded 
B) decrease; demanded 
C) have no effect on; demanded 
D) increase; supplied

Question 17

A firm owned by one individual is called a:

Accepted Answer

A) corporation. 
B) partnership. 
C) sole proprietorship. 
D) none of the above. 
A) corporation. 
B) partnership. 
C) sole proprietorship. 
D) none of the above.

Question 18

A persistent shortage may occur if:

Accepted Answer

A) the government imposes a price ceiling. 
B) a price floor is imposed. 
C) demand keeps falling. 
D) all of the above occur. 
A) the government imposes a price ceiling. 
B) a price floor is imposed. 
C) demand keeps falling. 
D) all of the above occur.

Question 19

Which of the following treatments does the Oregon health-care insurance plan agree to cover?

Accepted Answer

A) appendectomy for appendicitis 
B) liver transplants for alcoholic cirrhosis 
C) surgery for low back pain 
D) treatment for extremely premature babies 
A) appendectomy for appendicitis 
B) liver transplants for alcoholic cirrhosis 
C) surgery for low back pain 
D) treatment for extremely premature babies

Question 20

In the market for health care:

Accepted Answer

A) equilibrium occurs at the intersection of supply and demand, just as it does with most goods. 
B) the effect of third-party payers decreases the price that consumers pay. 
C) providers are encouraged to supply a greater quantity than they would without third-party payers. 
D) B and C are true. 
A) equilibrium occurs at the intersection of supply and demand, just as it does with most goods. 
B) the effect of third-party payers decreases the price that consumers pay. 
C) providers are encouraged to supply a greater quantity than they would without third-party payers. 
D) B and C are true.

Exam 4: Applications of Demand and Supply

Farm legislation has historically tried to increase farm income by:

Third-party payer systems for health-care services include payments made by:

The Oregon Plan for the provision of health care to people living below the poverty line generally increased the number and type of procedures for which they were eligible.

All health insurance plans charge the same and require subscribers to pay the same percentage of the costs of health care they consume.

Technological improvements in the health-care industry have been a primary factor in the increase in health-care costs.

Rent controls:

-(Exhibit: The Market for Health Care)Based on the exhibit and assuming that there are no third-party payers, the:

A cost that farm subsidies and price floors imposes on the rest of the economy is:

In 1997, nearly _______ percent of U.S.households owned a computer.

Most firms in the United States today are:

-(Exhibit: Third-party payers)At a price of $60 with a third party payer, the total cost of health-care services compared to the price that would prevail if there were no third-party payers has:

-(Exhibit: Third-Party Payers)Based on the exhibit, and assuming there are no third-party payers:

The downside to helping farmers through price supports and output restrictions has been that:

Economists classify health care as:

-(Exhibit: Rent Controls)Without rent controls, the equilibrium rent is _______ and the equilibrium quantity is _______ .

Eliminating third-party payer systems is most likely to ________ the quantity of health care ________.

A firm owned by one individual is called a:

A persistent shortage may occur if:

Which of the following treatments does the Oregon health-care insurance plan agree to cover?

In the market for health care:

Economics: the Study of Choice

Confronting Scarcity: Choices in Production

Demand and Supply

Macroeconomics: the Big Picture

Measuring Total Output and Income

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Monopoly

The World of Imperfect Competition

Wages and Employment in Perfect Competition

Interest Rates and the Markets for Capital and Natural Resources

Imperfectly Competitive Markets for Factors of Production

Public Finance and Public Choice

Inflation and Unemployment

International Trade

The Economics of the Environment

Inequality, Poverty, and Discrimination

Macroeconomics: the Big Picture

Measuring Total Income and Output

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Financial Markets and the Economy

Monetary Policy and the Fed

Government and Fiscal Policy

Consumption and the Aggregate Expenditures Model

Investment and Economic Activity

Net Exports and International Finance

Macro Inflation and Unemployment

Macro a Brief History of Macroeconomic Thought and Policy

Economic Development

Socialist Economies in Transition

Filters

-(Exhibit: Rent Controls)Without rent controls, the equilibrium rent is _ and the equilibrium quantity is _ .

Eliminating third-party payer systems is most likely to the quantity of health care .