What Is One Cited Reason Why Healthcare Expenditures Are So

question 11

Multiple Choice

What is one cited reason why healthcare expenditures are so high in the United States?

• A) Medicare and Medicaid reduce the supply of medical care.
• B) Doctors know patients are likely covered by insurance,which reduces the demand for medical care.
• C) Insurance companies attempt to control medical care costs by capping expenditures.
• D) Patients covered by insurance consume too little health care.
• E) Doctors know patients are likely covered by insurance and provide unnecessary services and treatments.

---

Definitions:

Long-Run Aggregate Supply

The total output of goods and services that an economy can produce when it is using all of its resources efficiently and at full employment.

Vertical

In economics, this term typically refers to a market structure where companies provide different, but related, products or services at various stages of production.

Money Supply

The total financial resources in an economy at a particular time, made up of cash, coins, and the holdings in checking and savings accounts.

Inflation

An increase in the average cost of goods and services, resulting in a drop in the value of purchasing power.