Health Economics:
1) {distribution of health expenditures} Ranking everyone by the amount spent on medical care, 30 percent ofthe total [all expenditures for all people) is accounted for by the top 1 percent of patients. Take the overall average per capita personal health expenditure and determine how much on average is spent on each of these high-cost patients. The top half ofthe population accounts for 90 percent of total spending.
What is the average amount spent on the remaining people in the bottom half ofthe distribution? Is the median [i.e., amount spent on the person who is at the middle of distribution, with half of all people spending more, and half of all people spending less) higher or lower than the mean?
2) {manpower} Which has increased more rapidly since 1929, the number of physicians or the number of ancillary health workers? As medicine becomes more technologically advanced, which will grow faster, the number of more-skilled workers or the number of less-skilled workers? (hint: For the previous two questions use the tables in chapter 1 of Getzen’s book)
3) What determines the value of a knee brace? How can an economist maintain that I am better off if] paid $7,000 for an operation that made my twisted knee worse rather than better?
4) lf the price of office visits increases from $20 to $22, and the number ofvisits per family per year declines from 12 to 10, what is the arc price elasticity of demand?
5) In the year 2005, in Anytown, suppose that one person is willing to pay $1,000 for relief from hay fever; another two are willing to pay $350; about five more are willing to pay $50; one is willing to pay $40; one is willing to pay $35; one each is willing to pay $34, $32, $30, and $28; about a dozen are willing to pay $10; four are willing to pay $5; and half of the rest of the town [another 75 people) are willing to pay $1.
a. Draw the demand curve for hay fever relief in Anytown.
b. What is the potential total benefit from relief of hay fever if it is provided to everyone who asks? To everyone willing to pay $35 or more?
c. lfthe price of hay fever medication is $20, what is the quantity demanded? What is the quantity demanded if the price is $50? $5?