Rapidly increasing health costs have been a major political concern since at least 1992. Suppose the government sets the maximum price for a normal doctor's visit at $20 to control rising health costs but the current market price is $40. What will happen?
A) Fewer people will try to see the doctor, and fewer doctors are willing to see patients
at that price.
B) More people will be able to see the doctor, since the price is lower.
C) More people will try to visit the doctor, but there will be fewer doctors willing to
see patients at that price.
D) The same number of people will try to visit the doctor, and the same number of
doctors are willing to see patients at that price.
C) More people will try to visit the doctor, but there will be fewer doctors willing to
You might also like to view...
The lack of a long-run tradeoff between the unemployment rate and the inflation rate means the long-run Phillips curve is
A) horizontal. B) vertical. C) upward sloping. D) downward sloping. E) U-shaped, with higher inflation initially decreasing unemployment and then increasing it back to the natural unemployment rate.
Which of the following would increase labor productivity, ceteris paribus?
A. A decrease in the quantity of capital. B. An increase in the number of participants in the labor force. C. An increase in the quality of capital. D. Crowding out.
Thinking at the margins means deciding about
a. maximizing goods and services. b. investing with borrowed money. c. adding or subtracting one additional unit of some resource. d. increasing or decreasing technical know-how.
Which has greater elasticity: a supply curve that goes through the origin with slope of 1 or a supply curve that goes through the origin with slope of 4?
A. The supply curve with slope of 4. Slope and elasticity are directly related so the higher the slope, the higher the elasticity. B. They both have the same elasticity. Any supply curve with a positive slope has the same elasticity. C. They both have the same elasticity. Any supply curve that goes through the origin has an elasticity of 1. D. The supply curve with slope of 1. Slope and elasticity are inversely related so the lower the slope, the higher the elasticity.