Efficiency Is Reached by Allocating Resources to Those Who Have

question 42

Multiple Choice

Efficiency is reached by allocating resources to those who have the greatest willingness to pay for them.This can be achieved in a market where a negative externality is present by:

• A) taxing consumers.
• B) giving consumers a subsidy.
• C) place a quota at the efficient level.
• D) All of these will achieve efficiency.

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Definitions:

Fee-For-Service

A payment model where services are unbundled and paid for separately, often leading to higher healthcare costs but greater flexibility for patients.

Salary

Regular payment made by an employer to an employee, usually monthly or biweekly, for their professional services.

Single Payer System

A healthcare system where a single public or quasi-public agency organizes healthcare financing, but delivery of care remains largely private.

Health Care Costs

Expenses related to medical care, including the cost of procedures, services, drugs, and equipment needed for the treatment and well-being of individuals.