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Question
Article SummaryAdministrative overhead costs resulting from insurance companies handling reimbursement claims is in large part the reason that health care in the United States is much more expensive than in other countries. An analysis on the administration costs of health care in the United States found that roughly 30 percent of the costs of health care are administrative and that more than 25 percent of health-sector employees work in administration. Health insurance companies are often paid a fixed percentage of the claims they administer, which gives them little to no impetus to increase efficiency and keep costs down.
Source: Jeffrey Pfeffer, "The Reason Health Care Is So Expensive: Insurance Companies," Bloomberg Businessweek, April 10, 2013.
Refer to the Article Summary. Even if insurance companies were more efficient and brought administrative costs down, consumers would still pay less than the full cost of medical treatment. This would result in the market equilibrium price of medical services being ________ than the efficient equilibrium price, and the market equilibrium quantity of medical services being ________ than the efficient equilibrium quantity.
A) greater; greater
B) greater; less
C) less; greater
D) less; less
Answer
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Related questions
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Suppose two countries use different combinations of inputs, such as labor and capital, to produce the same product. This implies all of the following except that
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B) its revenue increases.
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B) the relative input prices.
C) the slope of the isocost line.
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The typical shape of an isoquant is
A) convex towards the origin.
B) concave towards the origin.
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A) the level of sales necessary for a firm if it wants to expand.
B) the level of long-run average cost at different scales of operation.
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B) is equivalent to minimizing cost for a given level of output.
C) necessitates using only relatively low-priced inputs.
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C) $42,000
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Which of the following would be categorized as an opportunity cost?
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b. the cost of purchasing supplies for your house-cleaning business
c. the cost of purchasing auto insurance for your dry-cleaning delivery business
A) a only
B) a and c only
C) b and c only
D) all of the above