1. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain perfect competition. Which of the following is NOT correct about perfect compe

1. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain perfect competition. Which of the following is NOT correct about perfect competition? (Points : 12)

       Perfect competition means that individual firms are price takers and maximize profits.       consumers maximize utility.       barriers to entry or exit exist.       consumers have perfect information.

Question 2. 2. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain current trends in physician services. All of the following statements regarding the structure of the market for physicians services are correct EXCEPT _______ (Points : 12)

       there has been a significant increase in the physician to population ratio over the last three decades.       almost 90 percent of all physicians has at least on contact with a managed care organization.       many experts believe there are too many general practitioners and not enough specialists.       the physician services market has become more competitive over time.

Question 3. 3. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain current trends in physician income. Which statement describes average physician income in recent years? (Points : 12)

       Gains have been far greater than those of other professions.       Slight decreases in real income have made physicians lose ground relative to other professionals with graduate training.       Decreases have been substantial.       Specialty physicians have experienced substantial increases while general practitioners have experienced substantial decreases.

Question 4. 4. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain the market demand curve. Which of the following does NOT affect the position of the market demand curve? (Points : 12)

       Number of suppliers       Number of buyers       Consumer tastes       Price of substitutes and complements

Question 5. 5. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain monopolies. A monopolist will maximize profits if it produces an output where___________ (Points : 12)

       average total costs are minimized.       marginal costs equal marginal revenue.       marginal costs equal demand.       marginal revenue is zero.

Question 6. 6. Economists and accountants treat production costs differently. The difference is that economists consider ______________. (Points : 12)

       only the explicit costs       only verifiable costs       historical costs       opportunity costs

Question 7. 7. A hospital administrator speaking to a stakeholder group of physicians who work in the hospital. You want to explain factors that affect supply. Which of the following is NOT a factor that affects supply? (Points : 12)

       Input prices       Government regulations       Prices of production-related goods       Technological change

Question 8. 8. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain the purpose of the perfect competition model. Which of the following is NOT one of the purposes of the model? (Points : 12)

       Supply and demand, which are based on perfect competition, are useful in determining the impacts of market changes on price and output, even in medical markets.       A small number of consumers and producers maximize their own personal utilities and profits.       Healthcare markets may be reasonably competitive so supply and demand frameworks are appropriate.       The perfectly competitive market can serve as a gold standard to which other market models can be compared in terms of changes in prices and outputs.

Question 9. 9. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain cost theory. All the following statements regarding the cost theory are correct EXCEPT _____________ (Points : 12)

       the theory assumes that all firms are operating under conditions of perfect certainty       the theory assumes that all firms produce as efficiently as possible       the theory has limited usefulness to medical firms because these organizations usually have short run cost curves that are not U-shaped       the theory may be difficult to apply to medical firms because some firms may not have the incentive to produce as cheaply as possible

Question 10.10. As a hospital administrator speaking to a stakeholder group of physicians who work in the hospital you want to explain collusion. Which statement regarding a collusive oligopoly market is correct? (Points : 12)

       Production costs differences make it difficult for firms to cooperate.       The presence of trade associations in the market reduces the likelihood of collusive behavior.       The beliefs each firm forms about its rivals does not affect market output and price.       Profits do not serve as an important incentive mechanism and bring about an efficient allocation of resources in the long run.