EBK HEALTH ECONOMICS AND POLICY
EBK HEALTH ECONOMICS AND POLICY
7th Edition
ISBN: 9781337668279
Author: Henderson
Publisher: YUZU
Question
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Chapter 1, Problem 5QAP

a)

To determine

The validity of the five distortions in relation to the market of health care.

b)

To determine

The applicability of the five distortions to markets in general.

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In a commentary piece on the rising cost of health insurance, ("Healthy, Wealthy, and Wise," Wall Street Journal, May 4, 2004, A20), economists John Cogan, Glenn Hubbard, and Daniel Kessler state, "Each percentage-point rise in health-insurance costs increases the number of uninsured by 300,000 people." Assuming that their claim is correct, demonstrate that the price elasticity of demand for health insurance depends on the number of people who are insured. What is the price elasticity if 192 million people are insured? If 192 million people are insured, then the price elasticity of demand for health insurance is (Enter a numeric response using a real number rounded to three decimal places. Be sure to include the minus sign.) What is the price elasticity if 247 million people are insured? (Enter a numeric If 247 million people are insured, then the price elasticity of demand for health insurance is response using a real number rounded to three decimal places. Be sure to include the…
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