Economists John Cogan, Glenn Hubbard, and Daniel Kessler have estimated that repealing the tax preference for employer-provided health insurance would
A) significantly reduce the effectiveness of the health care received by those enrolled in these programs.
B) increase overall spending on health care as consumers would have to pay a higher price for medical services.
C) drive up prices for health care coverage since insurance reimbursements to doctors would be reduced.
D) reduce spending by people enrolled in these programs by 33 percent.
Answer: D
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The equilibrium level of income will rise when:
a. planned consumption spending is less than real GDP. b. taxes exceed saving. c. supply exceeds demand. d. planned inventory investment is negative. e. aggregate expenditures exceed real GDP.
An increase in the marginal propensity to save from .1 to .2 will cause
A) an increase in the multiplier and a given change in autonomous consumption (c0 ) to have a smaller effect on output. B) an increase in the multiplier and a given change in autonomous consumption (c0 ) to have a larger effect on output. C) a reduction in the multiplier and a given change in autonomous consumption (c0 ) to have a smaller effect on output. D) a reduction in the multiplier and a given change in autonomous consumption (c0 ) to have a larger effect on output.
If the economy is near full capacity, the effect of a negative aggregate demand shock is to
A) increase the level of aggregate demand. B) cause the price level to fall. C) increase the firm's cost of producing at every level of output. D) increase the level of employment.
Corporations account for a ____ proportion of U.S. firms and a ____ proportion of sales by U.S. firms
a. small; small b. small; large c. large; small d. large; large