Draw a market demand curve and market supply curve forautomobiles and label these curves D₁ and S₁, respectively.On the same graph, show what would happen if the autoworkers union required all manufacturers of automobilesto now provide health insurance for ALL workers andtheir dependents. (Note: Assume that prior to thischange, manufacturers of automobiles do NOT providehealth insurance coverage to 100 percent of theiremployees and/or their dependents.)Think about whether you think this change would affect thedemand curve or the supply curve for automobiles, and thenconsider in which direction you think the curve should shift.Draw a new curve and use a subscript 2 to identify it as thenew demand (D₂) or supply (S2), whichever is appropriate.Be sure to label:• Both axesThe original equilibrium price and quantity before thechangeThe new equilibrium price and quantity after the change

Market equilibrium refers to a situation where the amount of a particular product or service that…

Answered: Draw a market demand curve and market…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The following diagram shows the market for medical checkup. What are the equilibrium price and quantity of medical checkup? Which kind of externality problems exists in the market for medical checkup? How does this externality problem affect the efficiency of the market? Explain in detail. How can the government solve this externality problem? Explain in detail.
Briefly describe ( a) “play or pay,” (b ) tax credits and vouchers, and ( c) national health insurance as means of increasing access to health care. What are the major criticisms of national health insurance?
8. Agreement and disagreement among economists Suppose that Dmitri, an economist from a research institute in Texas, and Frances, an economist from a university in Massachusetts, are arguing over health Insurance. The following dialogue shows an excerpt from their debate: Frances: A popular topic for debate among politicians as well as economists is the idea of providing government assistance for health benefits. Dmitri: I think it is oppressive for the government to tax people who take care of themselves in order to pay for health insurance for those who are obese. Frances: I disagree. I think government funding of health insurance is useful to ensure basic fairness. The disagreement between these economists is most likely due to * Despite their differences, with which proposition are two economists chosen at random most likely to agree? Employers should not be restricted from outsourcing work to foreign nations. Business managers can raise profit more easily by reducing costs than by…
Draw a market where consumers demand health insurance and insurance companies supply insurance at a price of insurance called the premium. Explain why, in this model of the insurance market, the individual mandate (the mandate is everyone has to have insurance) will cause health insurance premiums to increase.
Suppose that there are two countries, Beta and Gamma. Suppose further that everyone in country Beta is on Insurance B and everyone in country Gamma is on Insurance G. Suppose further that both governments use government-set price controls. In 2005, country Beta decided to change the reimbursement rate for pharmaceuticals, but country Gamma did not make this change. You, a researcher, want to study the effect of offering coverage for this drug had an impact on health expenditures. You have average health expenditures for State Beta and Gamma prior to 2005 and post-2005. Using your finding from the question above, you can infer that country Beta likely _____ reimbursement rates for pharmaceutical drugs. State Time Periods Pre-2005 Post-2005 State Beta $1000 $1400 State Gamma $1500 $1700 a. lower b. did not change c. raised
Recall that the goal of the Affordable Care Act (also known as Obamacare) legislation was get more people access to affordable health insurance. It was widely reported that health insurance premiums under Obamacare were getting much more expensive. What was the main factor causing the premiums to get more expensive? Many of the new enrollees were young teenagers unable afford their own insurance, so other people are paying for them The plan required a lot of paperwork and administrative tasks, and insurance companies had to hire a lot of people to get these tasks done The new enrollees were older and sicker than expected, increasing health care usage and expenses, causing costs and insurance premiums to rise Obamacare created new medical technologies which were expensive to use
Compare the market for baby products and the market for childbirth (via either vaginal delivery or cesarean section procedure), then discuss the concept of ‘Agreement of Trade’ in both markets. Using illustrations, briefly explain how the following economic concepts find significance in understanding the market for health and health care: Scarcity, Choice and Opportunity Cost Efficiency and Equity Benefit-Cost Principle
For a single illness (such as a sore throat and cough), show the demand curves for three different consumers with different preferences about medical care and other goods. Need the demand curves be parallel? Could they ever cross? Now aggregate those three demand curves into a demand curve for them together. If these three people constitute the entire population in a market area, then this demand curve is the "market" demand curve. Think about what would happen when you aggregated the demand curves of thousands of individuals.
Suppose that Hubert, an economist from an AM talk radio program, and Kate, an economist from a school of industrial relations, are arguing over health insurance. The following dialogue shows an excerpt from their debate: Kate: A popular topic for debate among politicians as well as economists is the idea of providing government assistance for health benefits. Hubert: I think it is oppressive for the government to tax people who take care of themselves in order to pay for health insurance for those who are obese. Kate: I disagree. I think government funding of health insurance is useful to ensure basic fairness. The disagreement between these economists is most likely due to (DIFFERENCE IN SCIENTIFIC JUDGEMENT, DIFFERENCE IN VALUES, DIFFERENCE BETWEEN PERCEPTION VERSUS REALITY) . Despite their differences, with which proposition are two economists chosen at random most likely to agree? A. Employers should not be restricted from outsourcing work to foreign nations.…
Demand for medical services is price inelastic (Absolute value of price elasticity of demand is less than 1 and greater than zero). Medical services are different from most other goods and services in that the person who determines the demand (the patient) is not the person who makes the payment (payment is made by the insurance company). How does this affect the price elasticity of demand for medical services (increase it or decrease it)? You may assume that this question only refers to people who have health insurance. Ignore co-payments and deductibles and any other out-of-pocket expenses. Please give an explanation.
If the demand curve is steeper for particular health services the moral hazard is less ? True or false Explain briefly.
Some economists have suggested that the best way to control medical costs is to remove the profit incentive for health care providers, particularly hospitals. This would involve making all hospitals not-for-profit institutions. Use the utility maximization model to explain the likely impact such a policy would have on the cost of producing hospital services. What would happen if instead a policy was instituted that reduced barriers to entry in the hospital sector and therefore made the market more competitive?

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