The Figure Given Below Shows the Demand (D₁ and D₂)

question 69

Multiple Choice

The figure given below shows the demand (D₁ and D₂) and supply (S) curves of medical care. Figure 18.1

-Refer to Figure 18.1.One possible reason for the shift of the demand curve from D₁ to D₂ is the:

• A)increase in the cost of producing new drugs.
• B)restriction imposed by the government on the sale of new drugs.
• C)emergence of Medicare and Medicaid programs of the U.S.government.
• D)economies of scale experienced while producing medical care.
• E)decrease in the cost of producing medical care.

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Definitions:

Seasonal Indexes

A set of numerical values used to adjust for seasonal effects in time series data, allowing for more accurate comparisons across different times of the year.

Seasonal Variation

Refers to periodic fluctuations in data or processes that occur at regular intervals over a year, influenced by the seasons.

Least Squares

A mathematical approach used in regression analysis to determine the best-fit line through data points by minimizing the sum of the squares of the vertical differences between observed and predicted values.

Linear Trend Line

A straight line that best fits the data on a graph, showing the general direction that a set of data is moving towards.