Question: This question has 3 subparts, please read each carefully. You must label your graphs clearly to receive credit. (a) Suppose there are many hospitals (sellers)
This question has 3 subparts, please read each carefully. You must label your graphs clearly to receive credit. (a) Suppose there are many hospitals (sellers) and many health insurers (buyers), so that the health care market resembles perfect competition. Draw a graph to depict this market. Label clearly the producer surplus and consumer surplus. [4 points] (b) Now suppose, there is only one health insurer (buyer) and still many hospitals (seller). Thus, this is a monopsony market. Draw a graph to depict this market. Label clearly the producer surplus and the consumer surplus in this market.The entry of new firms leads to an increase
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