(a) Demand for a medical service is price inelastic. Medical services are different from most other goods and services in that the person who determines the demand (the patient) is not the person who makes the payment (payment is made by the insurance company). How does this affect the price elasticity of demand for medical services (increase it or decrease it)? You may assume this question refers to people who have health insurance. Give an explanation.
(b) A mass produced gold statue sold on the streets of Italy has a relatively higher price elasticity of demand, whereas fine art has relatively lower price elasticity--the number of buyers of Picasso stay fairly the same if the price doubles. Why is there a difference?