Question 1


Under the assumptions of perfect competition:
Answer

Price acts as a rationing mechanism and one market equilibrium price and quantity combination is reached.

Equilibrium occurs where marginal revenue is greater than marginal cost.

Income and the price of substitutes vary along a demand curve.

Price discrimination is possible.

People willing to pay less than the market clearing price are able to purchase health care services.
1 points
Question 2


The variation in salary and total compensation for hospital administrators is much greater than that of hospital emergency room physicians. The president of a large teaching hospital may earn multiples of the salary of the president of a smaller community hospital. Physicians employed by hospital emergency rooms will have a much smaller variation in salary. One reason for this is:
Answer

Physicians work more hours than administrators.

Variability in skill levels between the best and worst in the field.

Similarity in certification requirements.

Similarity in licensure requirements.

Variability in educational backgrounds.
1 points
Question 3


If a physician receives a bonus for referring a patient for cardiac surgery to a specialty hospital nearby his office:
Answer

The patient has violated the Stark law.

The physician has violated the Stark law.

The patient will probably receive better care than if he had gone to another hospital.

The patient's insurance company will always refuse to pay this bill.

The patient's insurance company will probably investigate for price discrimination.
1 points
Question 4


In the short run, the supply curve for physicians is essentially downward sloping due to the licensure requirements. True or false?
Answer
True
False
1 points
Question 5


When assessing the market demand and supply of physicians, economists look at all of the following, except:
Answer

Trends in the number of non-MD physicians, chiropractors, and physician substitutes.

Trends in the retirement rates of physicians.

Population growth.

Academic publication records of practicing physicians.

The number of students applying to medical schools.
1 points
Question 6


An HMO may monitor the diagnoses and treatments of participating physicians to determine how closely physicians follow observed norms of care or designated clinical pathways. This is a means for measuring:
Answer

Quality

Fraud

Billing errors

Accounting compliance

Effficacy of treatments
1 points
Question 7


Economies of scale means that a group physician practice is likely to return more income to physicians than would an individual practice. True or false?
Answer
True
False
1 points
Question 8


The federal government, through its control over the American Medical Association, held the physician supply constant for most of the 20th century. True or false?
Answer
True
False
1 points
Question 9


Charging higher premiums to women of child-bearing age than to men of the same age is an example of price discrimination. True or false?
Answer
True
False
1 points
Question 10


One would expect that price elasticity will be greater for __________ than for ___________.
Answer

medical school tuition; medical school entrance exam preparation tuition

appendectomies; dental exams

tonsillectomies; flu shots

medical school entrance examination preparation course tuition; medical school tuition

emergency room care; an annual mammogram