One Implication of the Results of the Manning Study Is

question 19

Multiple Choice

One implication of the results of the Manning study is that the demand for non-catastrophic health care is

• A)perfectly inelastic
• B)somewhat elastic
• C)driven by the media
• D)not subject to standard economic theory

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Definitions:

Socially Optimal Level

A state of resource allocation where the benefits to society are maximized, considering all externalities.

Excise Tax

A tax levied on specific goods or services, such as alcohol, tobacco, and gasoline, usually to discourage their use or to generate revenue.

Negative Externality

A cost that affects a party who did not choose to incur it, often associated with the consumption or production of goods and services.

Price

The sum required, expected, or disbursed as a purchase price for an item.