Suppose that the quantity demanded of visits to a doctor per year is given by X = 12 - 0.05P, where X is the number of visits and P is the price the patient pays for a visit.
(a) How many visits would the patient make if he or she had to pay the full price of a visit,
$100?
(b) How many visits would a patient make if he or she was insured and had to pay only a 15%
co-insurance payment per visit?
(c) How many visits would the patient make if medical services were free?
(a) At the full price of $100, she would make X = 12 - 0.05(100) = 7 visits.
(b) If she has to pay the 15% co-pay per visit, her price is just $15, so X = 12 - 0.05(15) =
11.25.
(c) If services were free, she would make X = 12 - 0.05(0) = 12 visits.
You might also like to view...
If the price is $60 per unit, what is the break even amount of units for technology A?
a. 50 b. 100 c. 150 d. None-They would have to shut down
Troubled Asset Relief Program is a government program that invested in financial institutions and automakers to help stabilize markets
Indicate whether the statement is true or false
According to "Coke Reignites Price War," price discounting (price wars) can destroy oligopoly profits. When profit destruction occurs,
A. Rival oligopolists seek to end it as quickly as possible. B. The entire industry will always collapse. C. Firms are powerless to change prices. D. Firms will wait for one firm to increase prices.
The prices of certain goods, such as ice and gasoline, often increase after a natural disaster such as a hurricane. The economic explanation for this observation is that
A. disasters bring out the worst in people. B. the disaster temporarily reduces the supply of the goods and reduces the demand for the goods. C. the disaster temporarily reduces the supply of the goods and increases the demand for the goods. D. people panic in disaster situations.