Global Health Economics
Test Bank
Course Introduction
Global Health Economics explores the economic factors influencing health outcomes and healthcare systems on a global scale. The course examines the allocation of healthcare resources, the financing of health interventions, and the economic impact of diseases and health policies across different countries. Students will analyze topics such as cost-effectiveness analysis, healthcare market failures, international health financing mechanisms, and the economic challenges faced by low- and middle-income countries. Through case studies and critical discussions, students gain a comprehensive understanding of how economic principles inform decision-making in addressing global health challenges and promoting equitable access to healthcare worldwide.
Recommended Textbook
Health Economics 6th Edition by
Rexford E. Santerre
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16 Chapters
240 Verified Questions
240 Flashcards
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Page 2
Chapter 1: Introduction
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Sample Questions
Q1) Which of the following represents an opportunity cost?
A) Increases in medical technology.
B) Reduction in fees for Medicare patients.
C) Additional spending on public health initiatives.
D) Increased enrollments at medical schools.
E) Forgone geriatric care to provide additional maternity services.
Answer: E
Q2) Any point _______ the production possibilities frontier is efficient and attainable.
A) inside of
B) along
C) outside of
D) both a and b are correct
E) both a and c are correct
Answer: B
Q3) Among developed countries, the U.S. has the lowest infant mortality rate.
A)True
B)False
Answer: False
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Chapter 2: Health and Medical Care: an Economic Perspective
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Sample Questions
Q1) Better macroeconomic conditions have a positive overall impact on health. A)True
B)False Answer: False
Q2) Advancements in medical technology allow people to obtain greater amounts of health with the same amount of medical care.
A)True
B)False Answer: True
Q3) _______ occurs when more patients are treated by a new medical intervention.
A) Income inequality
B) Treatment substitution
C) Social influence
D) Environmental impact
E) Treatment expansion
Answer: E
Q4) There is a constant relationship between increases in health and utility.
A)True
B)False Answer: False
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Chapter 3: Cost and Benefit Analysis
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Sample Questions
Q1) Cost-utility analysis assumes that life-years added due to a medical intervention are homogeneous.
A)True
B)False
Answer: False
Q2) Which of the following is considered a shortcoming of the human capital approach?
A) It includes nonmarket returns
B) It is used to estimate the value of a human life
C) It includes labor market imperfections
D) All of the above
E) None of the above
Answer: C
Q3) Cost-effectiveness analysis is useful in deciding if public funds should be spent on military personnel or public health initiatives.
A)True
B)False
Answer: False
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Chapter 4: Health Care Systems and Institutions
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Sample Questions
Q1) The purchase of insurance eliminates the risk of financial loss for all parties.
A)True
B)False
Q2) Which of the following refers to a situation where the health insurer reimburses 100% of the amount spent on medical services?
A) Patient Protection and Affordable Care Act of 2010
B) Managed care
C) Coinsurance
D) First dollar coverage
E) both c and d
Q3) Fee-for-service reimbursement systems help reduce health care expenditures.
A)True
B)False
Q4) The majority of U.S. hospitals operate as non-profit organizations.
A)True
B)False
Q5) Increased consumer copayment requirements may help to reduce health care expenditures.
A)True
B)False
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Chapter 5: The Demand for Medical Care
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Sample Questions
Q1) A _______ represents a fixed amount paid by the consumer that is independent of the market price or actual costs of medical care.
A) deductible
B) loading charge
C) coinsurance rate
D) claim
E) copayment
Q2) Since the demand for medical care is derived from the demand for good health, an increase in income will decrease the demand for medical care.
A)True
B)False
Q3) Consumer demand for medical care is considered a _______ demand, as it depends on the consumer's demand for good health.
A) absolute
B) derived
C) relative
D) supplemental
E) supply-side
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Chapter 6: The Demand for Medical Insurance: Traditional and Managed Care Coverage
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Sample Questions
Q1) An increase in income tax rates _______ the opportunity cost of purchasing employer-sponsored health insurance.
A) increases B) decreases C) does not affect D) eliminates E) transfers
Q2) Reduced coinsurance rates are likely to _______ moral hazard costs and _______ the risk exposure of the consumer.
A) increases; decreases B) decreases; decreases C) increases; increases D) decreases; increases
E) None of the above
Q3) Elimination of the tax-exempt status of employer-sponsored health insurance would most likely lead to a decrease in the purchase of health insurance.
A)True B)False
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Chapter 7: Medical Care Production and Costs
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Sample Questions
Q1) If a hospital is experiencing diseconomies of scale, it can reduce the average total cost of production by producing a greater quantity of medical services.
A)True
B)False
Q2) If a hospital is cost-minimizing, then the marginal productivity per dollar spent on physicians must be equal to the marginal productivity per dollar spent on nurses.
A)True
B)False
Q3) The _______ of nurses is represented as the change in medical services provided by an additional unit of nurse-labor.
A) marginal product
B) marginal cost
C) average product
D) opportunity cost
E) none of the above
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Chapter 8: Structure, Conduct, Performance, and Market Analysis
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Sample Questions
Q1) Barriers to entry are not present in which type of industry?
A) Perfect Competition
B) Monopolistic Competition
C) Oligopolies
D) Monopolies
E) None of the above
Q2) Collusion is most likely to occur within monopolistic competition.
A)True
B)False
Q3) If there is an increase in the number of registered nurses and the demand for medical services remains unchanged, what should be expected to happen to the real hourly wage for registered nurses?
A) The real hourly wage should increase.
B) The real hourly wage should only increase if the demand for medical services is inelastic.
C) The real hourly wage should only decrease if the demand for medical services is elastic.
D) The real hourly wage should decrease.
E) The real hourly wage should only increase if the demand for medical services is elastic.
Page 10
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Chapter 9: Government, Health, and Medical Care
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Sample Questions
Q1) A price ceiling will increase the quantity of medical care produced in a monopoly market.
A)True
B)False
Q2) Suppose a government decides to subsidize flu vaccinations in an attempt to correct a market failure. Without this government intervention, the flu vaccination would most likely be ______ due to the presence of _______.
A) over-consumed; negative externalities
B) under-consumed; positive externalities
C) over-consumed; positive externalities
D) under-consumed; negative externalities
E) none of the above
Q3) The U.S. federal income tax is _______, and therefore provides incentives for higher income individuals to purchase _______ amounts of employer-sponsored health insurance.
A) progressive; smaller
B) regressive; larger
C) regressive; smaller
D) progressive; larger
E) None of the above
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Chapter 10: Government As Health Insurer
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Sample Questions
Q1) If a physician is currently operating at full capacity, an increase in Medicare reimbursement rates could lead to decline in access for privately insured patients.
A)True
B)False
Q2) "Crowding out" due to an expansion of Medicaid requirements is best described by which of the following?
A) A family chooses to remain covered under employer-sponsored private health insurance.
B) An uninsured family chooses to enroll in Medicaid due to a low household income.
C) A family newly eligible withdraws from an employer-sponsored private health insurance and enrolls in Medicaid.
D) both b and c
E) none of the above
Q3) The Resource-Based Relative Value Scale System might cause an oversupply of certain medical services if the fee is set too high.
A)True B)False
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Page 12
Chapter 11: The Private Health Insurance Industry
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Sample Questions
Q1) Scale economies may serve as a barrier to entry in the private health insurance market by mandating a tiered benefit system.
A)True
B)False
Q2) _______ occurs when consumers have less incentive to avoid risky behaviors.
A) Ex post moral hazard
B) Ex ante moral hazard
C) Adverse selection
D) Asymmetric information
E) none of the above
Q3) _______ occurs when insurance companies structure plans that provide an incentive for healthier consumers to enroll while discouraging enrollment of higher-risk individuals.
A) Moral Hazard
B) Asymmetric Information
C) Cherry-picking
D) Guaranteed renewability
E) Adverse Selection
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Chapter 12: The Physician Services Industry
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Sample Questions
Q1) _______ refers to the exploitation of asymmetric information to increase demand for physician services.
A) Physician inflation rate
B) Supplier-induced demand
C) Fee-for-service
D) Market equilibrium
E) none of the above
Q2) Over the past thirty years, the absolute number of physicians has _______ while the physician-to-population ratio has _______.
A) decreased; decreased
B) decreased; increased
C) increased; remained stable
D) increased; increased
E) increased; decreased
Q3) What are the two primary goals of the malpractice system?
A) Reduce the number of claims and deter negligence
B) Compensate victims and deter negligence
C) Reduce the number of claims and limit the size of awards
D) Increase the number of claims and compensate victims
E) none of the above
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Chapter 13: The Hospital Services Industry
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Sample Questions
Q1) Which of the following accounts for the largest portion of hospital expenditures?
A) Private insurance
B) Out-of-pocket
C) Government
D) Charity care
E) Other
Q2) _______ occurs when changes to prices charged to payers changes as a compensating response to changes in administered prices of a different payer.
A) Scale economies
B) Sunk cost
C) Cost-shifting
D) Moral hazard
E) Hospital services price inflation
Q3) Continued hospital consolidations have led to diminished market concentration in most metropolitan market areas.
A)True
B)False
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Chapter 14: The Pharmaceutical Industry
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Sample Questions
Q1) Unconstrained physicians are more inclined to purchase brand-name instead of generic products because they are unaffected financially by the drug choice.
A)True
B)False
Q2) What percentage of industry output is accounted for by the four largest drug manufacturers?
A) 35%
B) 50%
C) 40%
D) 45%
E) 60%
Q3) Which of the following accounts for the largest share of expenditures on prescription drugs?
A) Private insurance
B) Medicare
C) Medicaid
D) Medigap
E) Out-of-pocket
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Chapter 15: The Long-Term Care Industry
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Sample Questions
Q1) Evidence suggests that nursing homes can substantially reduce their average total cost of production by increasing the amount of patients served due to substantial economies of scale.
A)True
B)False
Q2) Retrospective payment systems _______ costs, _______ quality, and result in _______ severe patient case-mixes.
A) raise; diminish; more B) raise; improve; less C) decrease; improve; more D) raise; improve; more E) decrease; diminish; less
Q3) Scale economies allow long-term care facilities to substantially decrease costs with only slight quality reductions.
A)True
B)False
Q4) Barriers to entry in the nursing home industry are relatively low.
A)True
B)False
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Chapter 16: Health Insurance Reform
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Sample Questions
Q1) Which of the generic health plans would contain costs through highly competitive insurance markets?
A) Managed competition
B) National health insurance
C) Medical savings accounts
D) Individual mandates
E) Both a and d
Q2) Which of the generic health plans would best eliminate the problem of moral hazard?
A) Managed competition
B) National health insurance
C) Medical savings accounts
D) Individual mandates
E) Both a and c
Q3) _______ has the highest infant mortality rate amongst developed countries.
A) Canada
B) The United States
C) France
D) Germany
E) Sweden
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