Suppose the court system begins to make it easier for plaintiffs to win large payments from doctors and other medical professionals who are accused of malpractice. What result would you expect?
A. Doctors would order more diagnostic tests and treatment procedures even when the costs of those procedures exceed the benefits to the patient.
B. Claims on medical insurance plans would probably fall.
C. The cost of medical care would fall because doctors would avoid expensive tests and treatments.
D. More people would seek training to become medical professionals because they would be able to make more money ordering tests and treatment procedures.
Answer: A
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Suppose two firms in a duopoly implicitly collude and charge a high price. How might each firm benefit from advertising that it will match the lowest price offered by its competitor?
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Each of the following, except one, would lead to a rightward shift of the labor supply curve in a particular industry. Which is the exception?
a. increased preference for this type of work b. increases in the demand for the good produced by labor c. increases in the size of the population d. reductions in the wage rates offered in alternative labor markets e. reductions in the costs of acquiring human capital
Here are four positions that Farmer Gomez can be in: (1 ) bad weather for Gomez and good weather for all other farmers; (2 ) bad weather for all farmers except Gomez (who witnesses good weather); (3 ) bad weather for all farmers; (4 ) good weather for all farmers. Assuming the demand for foodstuffs is inelastic, Farmer Gomez would probably rank these four positions, from best for him to worst for
him, the following way: A) 1,2,3,4. B) 2,1,3,4. C) 2,3,4,1. D) 4,3,2,1. E) 3,4,1,2.