The University of North Carolina at Pembroke
MPM 574--Health Economics
Practice Questions--Chapter 5

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 1.  Which of the following would tend to reduce a person's demand for professional health care?
      a.  the person is older
      b.  the person has a low wage rate
      c.  the person has little high transitory income
      d.  the person little education

 2.  According to the defensive-medicine hypothesis,
      a.  doctors perform unnecessary medicine to avoid law suits.
      b.  doctors raise their fees and do unnecessary work when their earnings start to fall.
      c.  doctors are prohibited from providing adequate care by managed care organizations.
      d.  doctors voluntarily reduce their level of care because of the expense of submitting procedures to managed care organizations for reimbursement.

  3.  Which types of health care tend to have the steepest demand curves?  Which types have the flattest demand curves?

  4.  Which tends to have the more elastic demand curve: the services of physicians as a group, or the services of Dr. Demi Rahl in particular?

  5.  The best estimates of the income elasticity of demand for medical care are about
       a.  -0.1
       b.   0.0
       c.   0.5
       d.   1.0

Also look at pp. 114-15, questions 4, 5, 6, 14 and 16.


last updated February 12, 2002, by Jim Frederick
copyright 2002 Jim Frederick