Respond to each of the following questions (150-200 words each) by applying the economic concepts described in this topic’s assigned readings from The Economics of Health and Medical Care.
Write the formula for price elasticity of demand and describe what it means.
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PEOD = % change in demand / % change in price
How would you expect the price elasticity of demand for health care to vary with health status?
Price elasticity of demand denotes a concept in economics that determines the percentage change in quantity purchased or demanded of a product relative to a percentage change in its own price (Dewar, 2017). It can be expressed mathematically using…
Would the demand for health care increase or decrease with an improvement in educational attainment in the community?
Studies using macroeconomic data indicate higher income elasticity for health care. Does that make health care an inferior, normal, or superior good? Explain.
According to some research, as a community’s educational attainment level increases the demand for medical care also increases. This because educated persons tend to seek preventive medical services. Improving education standards in the community creates health awareness and safety. The society becomes equipped with the necessary health skills and knowledge and at the same time, develop positive….
Describe the components of time cost in health care. Is time less costly for patients with higher wage rates? Explain.
Research suggests that the demand for medical care services is income elastic. Higher-income elasticity for medical services mean that as an individual income rises, the more they consume medical care services. According to Ringel, Hosek, Vollaard & Mahnovski, (2002), as a person’s or household…