Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 4.A, Problem 1ADQ
To determine
Asymmetric information and insurance price.
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Suppose that the price elasticity for hip replacement surgeries is 0.2. Further suppose that hip replacement surgeries are originally not covered by health insurance and that at a price of $50,000 each, 10,000 such surgeries are demanded each year. LO24.2 a. Suppose that health insurance begins to cover hip replacement surgeries and that everyone interested in getting a hip replacement has health insurance. If insurance covers 50 percent of the cost of the surgery, by what percentage would you expect the quantity demanded of hip replacements to increase? What if insurance covered 90 percent of the price? If insurance covers 50 percent of the bill, just assume that the price paid by consumers falls 50 percent.) b. Suppose that with insurance companies covering 90 percent of the price, the increase in demand leads to a jump in the price per hip surgery from $50,000 to $100,000. How much will each insured patient now pay for a hip replacement surgery? Compared to the original situation,…
A group of 200 people seek out an insurance company to underwrite health insurance for its members. It expected
medical spending for the group is $1,200,000, what will the average premium bn If the health insurance company
adds a leading fee of 20 percent?
$14,400
$12,000
O $7,200
O $6,000
In 2017, health care spending in the US accounted for approximately of the GDP.
O 5%
17%
25%
38%
45%
QUESTION 2
Without any change to the health insurance system, by 2082, health care spending in the US is expected to reach
5%
18%
25%
49%
QUESTION 3
The main reason why health care spending is increasing over time is
O Increasing administrative costs
Increasing uncompensated care
O population aging
increase in sophistication and quality of medical services
the Affordable Care Act
QUESTION 4
Regarding health insurance, the number of uninsured individuals in the US is approximately
8 million
18 million.
28 million
48 million
98 million
of the GDP.
Chapter 4 Solutions
Microeconomics
Ch. 4.A - Prob. 1ADQCh. 4.A - Prob. 2ADQCh. 4.A - Prob. 3ADQCh. 4.A - Prob. 1ARQCh. 4.A - Prob. 2ARQCh. 4.A - Prob. 3ARQCh. 4.A - Prob. 1APCh. 4 - Prob. 1DQCh. 4 - Prob. 2DQCh. 4 - Prob. 3DQ
Ch. 4 - Prob. 4DQCh. 4 - Prob. 5DQCh. 4 - Prob. 6DQCh. 4 - Prob. 7DQCh. 4 - Prob. 8DQCh. 4 - Prob. 9DQCh. 4 - Prob. 1RQCh. 4 - Prob. 2RQCh. 4 - Prob. 3RQCh. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 6RQCh. 4 - Prob. 7RQCh. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7P
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