Suppose that a health insurance plan offers a $10 deductible with a 20% coinsurance rate. The...

 

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Suppose that a health insurance plan offers a $10 deductible with a 20% coinsurance rate. The price of healthcare is $1. The price of healthcare is given by D (HC), while the quantity of healthcare consumed is given by Q (HC). The demand curve for "A's" is given by: D (HC A's) 10-3*Q (HC) The demand curve for "B's" is given by: D (HC B's) 20-Q (HC) a. What is the consumption of both "A's" and "B's" without health insurance? b. What is the consumption of both "A's" and "B's" with health insurance? c. Is there any distortion of healthcare consumption by having health insurance? If so, how much (separate by group). d. How much do "A's" spend out-of-pocket on healthcare, with health insurance? How much do "B's"? Suppose that a health insurance plan offers a $10 deductible with a 20% coinsurance rate. The price of healthcare is $1. The price of healthcare is given by D (HC), while the quantity of healthcare consumed is given by Q (HC). The demand curve for "A's" is given by: D (HC A's) 10-3*Q (HC) The demand curve for "B's" is given by: D (HC B's) 20-Q (HC) a. What is the consumption of both "A's" and "B's" without health insurance? b. What is the consumption of both "A's" and "B's" with health insurance? c. Is there any distortion of healthcare consumption by having health insurance? If so, how much (separate by group). d. How much do "A's" spend out-of-pocket on healthcare, with health insurance? How much do "B's"?

Answer rating: 100% (QA)

aAs Q 103 Bs Q 20 As 103 103Q3 Bs 20 20Q As 103 103Q3 This equation can be rewritten as 103 103 Q wh... View the full answer