Use the Following to Answer Questions

question 53

Multiple Choice

Use the following to answer questions .
Exhibit: The Market for Health Care
-(Exhibit: The Market for Health Care) Based on the exhibit and assuming that there are no third-party payers:

• A) the equilibrium quantity is Q₂.
• B) the equilibrium quantity is Q₁.
• C) the total amount spent on health-care services at the equilibrium price is given by the area OP₃BQ₂.
• D) none of the above are true.

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Definitions:

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount subject to tax, causing taxpayers to pay the same percentage of their income irrespective of its size.

Deductions

Expenses subtracted from gross income to determine the taxable income.

Excise Tax

A tax levied on certain goods, services, and activities, such as tobacco, alcohol, and fuel, usually to discourage their consumption and raise government revenue.

Local Property Tax

A tax assessed on real estate properties, usually levied by local government entities such as cities or counties.