Multiple Choice Questions:
1. Physicians are least likely to limit the utilization of health care services if
a. They are paid an annual salary for their services.
b. They are paid on a fee-for-service basis.
c. They are restricted to choosing treatment options on an approved list.
d. They are required to contain health care costs as a condition of membership in a physicians’ network.
2. Technological advances in medical care
a. Always lead to reductions in the overall cost of treating a disease.
b. Always lead to increases in the overall cost of treating a disease.
c. Can either increase or decrease the overall cost of treating a disease.
d. Decrease the supply of health care.
3. Technological advances in medical care
a. Increase the supply of health care.
b. Increase the demand for health care, since the quality of care increases.
c. Can either increase or decrease the overall cost of treating a disease.
d. Are characterized by all of the above.
4. The supply of health care services is restricted by
a. The compulsory licensing of physicians.
b. Limitations on hospital privileges of physicians.
c. A reduction in the wages of health care employees.
d. All of the above.
e. Only a and b.
5. Natural monopolies may arise in health care
a. When the government grants exclusive licenses for hospitals to operate in a local area.
b. When cities and towns are sufficiently small that they are unable to support a large number of hospitals.
c. When a health care provider holds crucial patents over new medical technologies.
d. In metropolitan areas with large populations.
6. It has been shown that in states where restrictions are placed on the advertising of eyeglasses
a. Price competition between eyeglass manufacturers increases.
b. Consumers pay, on average, lower prices.
c. Consumers pay, on average, higher prices.
d. The prices of eyeglasses are unaffected.
e. Both a and b occur.
7. When the price of health care is controlled,
a. Shortages are likely to result.
b. It may be necessary to ration health care services.
c. Patients may die while waiting for treatment.
d. All of the above may occur.