Refer to the graph shown that depicts a third-party payer market for prescription drugs. What is the cost of this program to the third-party if a $2 co-pay is established?
A. $120
B. $180
C. $240
D. $270
Answer: B
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If a country begins allowing free international trade in a good, and as a result, it increases imports of that good
a. domestic producers gain more than domestic consumers lose. b. domestic producers lose more than domestic consumers gain. c. domestic consumers gain more than domestic producers lose. d. domestic consumers lose more than the domestic producers gain.
If a large percentage increase in the price of a good results in a small percentage reduction in the quantity demanded of the good, demand is said to be
a. horizontal. b. relatively inelastic. c. relatively elastic. d. income proof.
A temporary decrease in the price of oil would be considered a:
A. long-run supply shock. B. demand shock. C. short-run supply shock. D. The changing price of oil would not affect any of these.
Refer to the graph shown. Assume that the market is initially in equilibrium at a price of $6 and a quantity of 40 units. If the government imposes a $2 per-unit tax on this product, it will collect tax revenue in the amount of:
A. $120. B. $80. C. $60. D. $100.