MHA 710 Exam 1 Questions with verified Answers latest update, Exams of Nursing

Download MHA 710 Exam 1 Questions with verified Answers latest update and more Exams Nursing in PDF only on Docsity! MHA 710 Exam 1 Questions with verified Answers latest update 1. Even in the US, approximately, what percent of medical care is purchased through insurance, government programs or other third party insurers?- Correct Answer - 90 2. The opportunity cost of investing in a new lithotripter (a machine that pulverizes kidney stones with sound waves) is- Correct Answer - defined by the next best use of the money invested in the equipment. 3. What percentage of Americans considered the complete repeal of the Pa- tient Protection And Affordable Care Act of 2010 a good thing?- Correct Answer - 40 percent 4. By 2020, what was the forecasted percentage amount of health care spend- ing paid by individuals?- Correct Answer - 10.4 percent 5. The "invisible hand" using Adam Smith's terminology refers to- Correct Answer - market forces working through the price mechanism. 6. According to recent public opinion polls, what percentage of Americans are satisfied with the quality of the medical care they receive?- Correct Answer - 70 percent 7. According to economic theory what is the optimal percentage of GDP to be spent on medical care?- Correct Answer - There is no widely accepted way to determine the optimal percentage. 8. Which of the following statements is based on positive analysis?- Correct Answer - Individuals without health insurance have less access to physicians' services than those who have health insurance and The high cost of health insurance places U.S. firms at a competitive disadvantage with their foreign competitors. 9. Public option- Correct Answer - A public health insurance plan comparable to Medicaid, designed to compete with private insurance. 10. Uncertainty- Correct Answer - A state in which multiple outcomes are possible but the likelihood of any one outcome is not known. 11. Premium- Correct Answer - A periodic payment required to purchase an insurance policy. 12. Group insurance- Correct Answer - A plan whereby an entire group receives insurance under a single policy. The insurance is actually issued to the plan holder, usually an employer or association. 13. Medicare- Correct Answer - Health insurance for the elderly provided under an amendment to the Social Security Act. 14. Medicaid- Correct Answer - Health insurance for the poor financed jointly by federal and state governments. 15. Flexner Report- Correct Answer - A 1910 report published as part of a critical review of medical education in the United States. The response of the medical establishment led to significant changes in the accreditation procedures of medical schools and an improvement in the quality of medical care. 16. Collective bargaining- Correct Answer - The negotiation process whereby representatives of employers and employees agree upon the terms of a labor contract, including wages and benefits. 17. Cost shifting- Correct Answer - The practice of charging higher prices to one group of patients, usually those with health insurance, in order to provide free care to the uninsured or discounted care to those served by Medicare and Medicaid 18. Certificate of need (CON)- Correct Answer - Regulations that attempt to avoid the costly duplica- tion of services in the hospital industry. Providers are required to secure a certificate of need before undertaking a major expansion of facilities or services. 19. Employee Retirement Income Security Act (ERISA)- Correct Answer - Federal legislation passed in 1974 that sets minimum standards on employee benefit plans, such as pensions, health insurance, and disability. The statute protects the interests of employees in matters concerning eligibility for benefits. The law also protects employers from certain state regulations. For example, states are not allowed to regulate self-insured plans and cannot mandate that employers provide health insurance to their employees. 20. Entitlement programs- Correct Answer - Government assistance programs where eligibility is determined by a specified criteria, such as age, health status, 43. Natural monopoly- Correct Answer - A firm becomes a natural monopoly based on its ability to provide a good or service at a lower cost than anyone else and satisfy consumer demand completely. 44. Gross domestic product (GDP)- Correct Answer - The monetary value of the goods and services produced in a country during a given time period, usually a year. 45. Third-party payers- Correct Answer - A health insurance arrangement where the individual, or agent of the individual, pays a set premium to a third party (an insurance company, managed care organization, or the government), which in turn pays for health care services. 46. Primary and preventive care- Correct Answer - Routine medical care and screening generally provided by physicians specializing in family practice, general internal medicine, and pediatrics. 47. Price transparency- Correct Answer - Readily available and easy-to- understand information on the actual prices paid for medical care services. The actual price paid is essential if consumers are to value and rank alternative treatment options and make informed decisions on the care they receive. 48. Price discrimination- Correct Answer - The practice of selling the same good or service to two different consumers for different prices. The price differential is not based on differences in cost. 49. Dead weight loss- Correct Answer - Cost to society stemming from a market failure to efficiently allocate resources. The resulting equilibrium fails to produce the socially optimum quantity of a good or service. Often caused by government actions such as taxes, subsidies, price controls, or other restrictions on the market. 50. Disease incidence- Correct Answer - The occurrence of new cases of a specific disease over a specific period of time. 51. Equilibrium- Correct Answer - The market-clearing price at which every consumer wanting to purchase the good finds a willing seller. 52. Correlation- Correct Answer - A simple association between two variables. The actions are relat- ed to one another without either one causing the other. 53. Suppose you are a consultant advising the U.S. government on reducing national health care spending. Assuming that providers will accommodate patient desires, what advice could you offer concerning the implementation of a price ceiling?- Correct Answer - Total spending may rise if providers intensify services and create new technology for the uncontrolled sector. 54. A binding price ceiling- Correct Answer - will cause the quantity of health care provided to fall when providers accommodate patient desires up to a point. But when providers are willing to accommodate patient desires, spending is actually likely to rise if providers intensify their services and increase demand. By expanding the size of the eligible population and creating new technology for the uncontrolled sector of the market, total spending can shift demand to the right and increase total spending 55. Since 1950, U.S. health care spending has grown from an average of 4.5 percent of GDP to an estimated forecast of percent of GDP in 2020.- Correct Answer - 18 percent 56. Which of the following is NOT considered to be a factor in the recent slowing of health care spending?- Correct Answer - Growing U.S. gross domestic product (GDP) 57. that a country has more resources available to divert to health care spend- ing and other areas of the economy- Correct Answer - The Affordable Care Act (ACA), the Great Recession, prospective payment, and higher deductibles have all been put forward as factors contributing to the slowing of national health care spending. A growing GDP should conversely mean 58. Assuming that providers will only accommodate patient desires up to a point, what effect would a binding price ceiling have on the health care market?- Correct Answer - Quantity of health care supplied would fall. 59. Because the price ceiling is binding- Correct Answer - the control would be effective in reducing price in the health care market. Under the assumption that health care providers will only accommodate patient desires up to a point, we can infer that a lesser quantity of health services will be offered at the restricted price. 60. Suppose you are a politician being criticized in a debate for your commit- ment to reducing the growth of medical spending. Which of the following is the most appropriate response?- Correct Answer - Reducing wasteful health care spending could provide additional funding to the education sector. 61. which leaves fewer funds for other sectors.- Correct Answer - There is no evidence thus far of an ideal level of medical spending, nor that high levels of spending are damaging to the economy. In fact, it is a common trend among developed nations to spend a high proportion of their GDP on health care. High health care prices have also been suggested as important incentives for the development of new treatments and technology. And as resources are scarce, there is an opportunity cost associated with increasing medical spending, 62. Charging higher prices for one category of patients in order to provide free or subsidized care to another group is called- Correct Answer - cost shifting. 63. Cost shifting is the practice of- Correct Answer - charging higher prices to one group of patients, usually those with private health insurance, in order to subsidize the care of those whose payments do not cover the fully allocated cost of the care they receive. 64. According to Adam Smith's terminology, the "invisible hand" refers to- Correct Answer - - market forces working through the price mechanism. 65. The term is a metaphor used by Adam Smith in his 1776 treatise The Wealth of Nations.- Correct Answer - It refers to the interaction of the forces of supply and demand in competitive markets that result in a free market equilibrium. Buyers willing to pay the equilibrium price can find willing providers to sell to them at that price. The market clears and resources are allocated efficiently. 66. Economists use the term marginal to describe costs and benefits- Correct Answer - that are incremental and thus relevant to decision making. 67. Marginal analysis is the- Correct Answer - economic way of thinking about optimal decision making. Choices are seldom all-or-none propositions—decisions are made at the margin. Real-world decisions are usually a matter of trading off one option for an- other. Resources are scarce. There are never enough resources to satisfy everyone with everything they want. 68. The cost to society resulting from taxation to finance government spend- ing is called- Correct Answer - deadweight loss. 69. Which of the following is NOT a potential result of ever-increasing health care pricing?- Correct Answer - Reduced incentives for innovation. 70. Continually increasing health care prices could result in- Correct Answer - reduced affordabil- ity and accessibility to care, a greater share of the population without insurance, and a tax increase to cover the growing burden of health care. However, high prices in health care serve as a financial incentive to innovation. the following did they believe to be the integrator that could make this possible?- Correct Answer - c.ACOs (accountable care organizations) 92. Which of the following were part of the original ACA legislation enacted in 2010?- Correct Answer - a.Expansion of Medicaid b.Spending cuts in Medicare c.New federal taxes 93. Which of the following categories accounts for the largest share of health care spending in the United States?- Correct Answer - a.Hospital care 94. Which of the following are considered to be a source of waste in health care spending?- Correct Answer - a.Excessive administration costs b.Fraud and abuse c.High prices 95. Which of the following statements is an explanation for why the United States spends so much on health care?- Correct Answer - c.Decreased coverage by 3rd party payers 96. When randomized sampling is unavailable or unfeasible, which of the following problems must researchers address?- Correct Answer - c.Selection bias 97. Which of the following are identification strategies used by researchers to reduce selection bias in an observational study?- Correct Answer - a.Propensity score matching b.Difference-in-difference c.Synthetic control 98. Economic efficiency- Correct Answer - Producing at a point at which average product is maxi- mized and average variable cost is minimized. 99. Scarcity- Correct Answer - A situation that exists when the amount of a good or service demanded in the aggregate exceeds the amount available at a zero price. 100. Invisible hand- Correct Answer - A metaphor introduced by Adam Smith describing the role that markets play in promoting the efficient allocation of resources. 101. Prisoner's dilemma- Correct Answer - A paradox in game theory where players acting in their own self-interest choose their dominant strategies and do not achieve the optimal outcome. In such cases, cooperation, not competition, will result in a more profitable outcome. 102. Nash equilibrium- Correct Answer - A situation that emerges when all players in a noncooper- ative game choose their dominant strategy and have nothing to gain (and can only lose) by changing from their initial strategies. 103. Rational behavior- Correct Answer - A key behavioral assumption in neoclassical economics that decision makers act in a purposeful manner. In other words, their actions are directed toward achieving an objective. 104. Microeconomics- Correct Answer - The study of individual decision making, pricing behavior, and market organization. 105. Rational Ignorance- Correct Answer - A state in which consumers stop seeking information on a prospective purchase because the expected cost of the additional search exceeds the expected benefits. 106. Incentives- Correct Answer - Anything that motivates individuals to take certain actions. 107. Economizing behavior- Correct Answer - When individuals choose to limit their demand for goods and services voluntarily to save money. 108. optimization- Correct Answer - A technique used to determine the best or most favorable out- come in a particular situation. 109. Economic problem- Correct Answer - A problem of resource allocation faced by all decision makers- Correct Answer - what to produce, how to produce it, and who receives it. 110. Marginal cost- Correct Answer - The change in total cost resulting from a one-unit change in the level of output. 111. Marginal benefit- Correct Answer - The change in total benefits resulting from a one-unit change in the level of output. 112. Quality-adjusted life years (QALY)- Correct Answer - A measure of the effectiveness of a med- ical treatment that captures improvements in the quality of life as well as extensions in the length of life. 113. Risk- Correct Answer - A state in which multiple outcomes are possible, and the likelihood of each possible outcome is known or can be estimated. 114. Self-interest- Correct Answer - A behavioral assumption of neoclassical economics that individ- uals are motivated to promote their own interests. 115. Substitution effect- Correct Answer - Describes how a change in the price of a good changes the quantity of a good demanded resulting from the consumer's willingness to shift demand to goods that have become relatively cheaper. 116. Income effect- Correct Answer - Describes how a change in the price of a good can change the quantity of a good demanded resulting from the change in the consumer's purchasing power. 117. Not-for-profit- Correct Answer - A business classification that is exempt from paying most taxes. In return for this tax-exempt status, the firm is restricted in how any operating surplus may be distributed among its stakeholders. 118. Observational study- Correct Answer - Studies where the researcher observes the effect of a treatment on individuals without trying to influence who receives the treatment. 119. Randomized controlled trial (RCT)- Correct Answer - A study where participants are randomly assigned into treatment and control groups. The only expected difference between the two groups is the outcome. 120. Treatment group- Correct Answer - As part of an experiment, the group that actually receives the treatment, sometimes called the experimental group. 121. Control group- Correct Answer - As part of an experiment, the group that receives the standard treatment, a placebo, or no treatment at all. 122. Causation- Correct Answer - Indicates a cause and effect relationship; in other words, a partic- ular action results in a specific outcome- Correct Answer - action A causes outcome B. 123. Endogeneity- Correct Answer - Introduces bias in an empirical estimate when there is a corre- lation between the covariates and the error term in the model. 124. Treatment effect- Correct Answer - Causal effect of a given intervention or policy change on an outcome, affecting one group (the treatment group) and not others (the control group). 125. Covariates- Correct Answer - Characteristics of the participants in an empirical study (not includ- ing the treatment effect), such as demographic information and other confounding variables. 152. Type I error- Correct Answer - Rejecting a hypothesis that is true. 153. Type II error- Correct Answer - Accepting a hypothesis that is false. 154. Asymmetric information- Correct Answer - A situation in which information is unequally distrib- uted between the individuals in a transaction. The person with more information will have an unfair advantage in determining the terms of any agreement. 155. Production function- Correct Answer - A way to depict the relationship between the inputs in a production process and the resulting output. 156. Isoquants- Correct Answer - Literally "equal quantity." A contour line that shows the different combinations of two inputs that produce the same level of output. 157. Marginal rate of technical substitution (MRTS)- Correct Answer - As the amount of one input in a production process increases, the amount of the other input can be decreased without changing the level of output. 158. Variable inputs- Correct Answer - Inputs in the production process that are easily incremented. 159. Fixed inputs- Correct Answer - Inputs in the production process that are difficult to increment. 160. Long run- Correct Answer - The period of time where all inputs are variable. 161. Short run- Correct Answer - The increment of time where at least one input is fixed. 162. Average product- Correct Answer - Output per unit of input. 163. Marginal product- Correct Answer - The change in total product resulting from a unit change in input. 164. Total product- Correct Answer - Total output that results from using different levels of an input 165. Law of diminishing returns- Correct Answer - The empirical observation that expanding the use of one input (holding all others constant) will eventually result in a decreasing rate of change in marginal productivity. 166. Isocost curve- Correct Answer - A locus of points that shows the various combinations of inputs that have the same cost. 167. An inferior good- Correct Answer - a. has a negative income elasticity. b. is one where the demand curve shifts to the left when income goes up. 168. Which of the following will not change the demand for office visits to the physician?- Correct Answer - A change in the price of an office visit 169. Which of the following will not cause a shift in the medical care supply curve?- Correct Answer - A change in the percentage of the population with health insurance 170. Supply curves are positively sloped because of- Correct Answer - the law of diminishing returns. 171. A shortage of hospital beds will likely lead to- Correct Answer - an increase in the price of a hospital stay. 172. Suppose angioplasty and coronary artery bypass graft (CABG) surgery are substitute treatment alternatives for coronary artery disease. What should happen to the equilibrium price and quantity of angioplasty procedures if a new CABG technique is introduced that is less invasive (requiring a 4-inch in- cision under the breast bone rather than cracking open the patient's rib cage) and requires one-third the recovery period of regular CABG surgery?- Correct Answer - Both price and quantity will decrease. 173. Suppose the market for hospital outpatient treatment is in equilibrium when a price ceiling is set below the equilibrium price. What do you expect to happen?- Correct Answer - A shortage will develop. 174. A physician's office expenses increase 10 percent, so they decide to raise the price of office visits. Assuming the demand curve for office visits does not shift, what will happen to the total number of office visits and practice revenues?- Correct Answer - Office visits will fall and total revenue will rise if demand is inelastic. 175. If a hospital is experiencing economies of scale,- Correct Answer - b. its average cost curve is negatively sloped as output increases. 176. When a physician knows more about alternative treatments than her patients, we say that exists.- Correct Answer - asymmetric information 177. Under which of the following circumstances is the principal-agent prob- lem likely to be most serious?- Correct Answer - Between surgeons and patients 178. A patient has a medical condition, but he doesn't know what it is. The physician he sees diagnoses his illness correctly. What term applies to this situation?- Correct Answer - Asymmetric information 179. The market for medical care relies primarily on- Correct Answer - Not for profit providers. 180. Which of the following results from providers having more information about treatment alternatives than their patients?- Correct Answer - a. Principle- agent problem. b. Rational ignorance. c. Externalities. d. Adverse selection. e. The substitution effect 181. Nonexcludable and nonrival goods are known as- Correct Answer - Public goods. b. Private goods. c. Efficient goods. . d. Those which are the last to be purchased. e. There is no such thing as goods which are both Nonexcludable and nonrival. 182. The optimal level of output may be defined as that level of output where- - Correct Answer - the marginal benefit of the last unit purchased equals its marginal cost. 183. Inoculation programs against certain diseases such as small pox, polio, and whooping cough create- Correct Answer - positive externalities in consumption. 184. An inferior good- Correct Answer - causes the demand curve to shift to the left when income rises 185. Suppose angioplasty (with stents) and coronary artery bypass graft (CABG) surgery are substitute treatment alternatives for coronary artery dis- ease. What should happen to the equilibrium price and quantity of angioplasty procedures performed if a new CABG technique is introduced that is less invasive (requiring a 4-inch incision under the breast bone rather than crack- ing open the patient's rib cage) and requires one-third the recovery period of regular CABG surgery?- Correct Answer - Both price and quantity will decrease. 186. Suppose the demand curve for medical care services is perfectly inelas- tic. What will happen to the equilibrium price and quantity if supply increas- es?- Correct Answer - Price will fall and quantity will stay the same. 187. Supply curves are positively sloped because of- Correct Answer - the increasing opportunity cost of resources.