When the 2010 Patient Protection and Affordable Care Act Is

question 68

Multiple Choice

When the 2010 Patient Protection and Affordable Care Act is fully implemented, it will

• A) set the prices (reimbursement rates) for more than 7,000 different medical procedures.
• B) increase the supply of doctors and other medical services.
• C) increase the supply of doctors and other medical services
• D) reduce the share of health care expenses paid for by a third party, which will increase the incentive of both consumers and medical providers to economize.
• E) All of the above are true.

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Definitions:

Profit Maximizing Price

The price at which a firm can generate the highest possible profit, determined by the intersection of the firm's supply curve and the market demand curve.

Profit Maximizing

The process of finding the level of output where a firm achieves the maximum possible profit.

Kinked Demand Curve Model

Oligopoly model in which each firm faces a demand curve kinked at the currently prevailing price: at higher prices demand is very elastic, whereas at lower prices it is inelastic.

Rivals' Price

The cost set by competing businesses for similar products or services in the market.