Studies in Industrially Advanced Nations Indicate That a 3 Percent

question 117

Multiple Choice

Studies in industrially advanced nations indicate that a 3 percent increase in incomes will generate a

• A) 1 percent increase in the amount of health care demanded.
• B) 1.5 percent increase in the amount of health care demanded.
• C) 3 percent increase in the amount of health care demanded.
• D) 6 percent increase in the amount of health care demanded.

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Definitions:

Market Resources

The assets, materials, and inputs used to produce goods and services and are made available through the market.

Entrepreneurs

Individuals who innovate, finance, and manage business ventures, often taking on greater than normal financial risks.

External Cost

Costs that a producer or consumer inflicts on a third party who is not involved in the production or consumption of the goods or services.

Economic Efficiency

A situation in which all resources in an economy are optimally distributed to serve each individual or entity in the best way while minimizing waste and inefficiency.