Consider Troy and Paula, Each of Whom Recently Purchased Health

question 54

Multiple Choice

Consider Troy and Paula, each of whom recently purchased health insurance with a 20% coinsurance rate (i.e., an insured person pays 20% of the price of a physician visit) . Troy's demand curve for physician visits is Q_R = 6, and Paula's demand curve for physician visits is Q_P = 20 - 0.10P, where Q represents the number of physician visits and P is the price per visit. Suppose that the market price, P, for physician visits is $100. With a 20% coinsurance rate and a market price of $100, Paula pays $____ out-of-pocket per visit.

• A) 40
• B) 30
• C) 20
• D) 10

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