Deck 15: History, Demography, and the Growth of Modern Medicine

Question 1

Development of modern medicine has been made possible due to the exclusive influence of the following two crucial factors: development of effective medical technology and financial institutions to support it.

Answer 1

False

Question 2

In the U.S., the key determinant of population growth during recent decades has been the increasing excess of birth rates over death rates.

Answer 2

False

Question 3

Immigration is simply a movement of people from one country to another, so calculation of population growth rates on a world-wide basis does not include immigration.

Answer 3

True

Question 4

The Stone Age is characterized by equality of income, low medical expenditures and population growth rates which doubled every 10,000 years.

Question 5

Population growth during the Stone Age meant that when the world population had reached about 4,000,000, it began to strain the available food sources. As a result, economic development in areas such as animal husbandry and plant cultivation arose to meet those needs.

Question 6

During the Agricultural Age many communities were highly susceptible to catastrophic losses of life from drought, pestilence and disease.

Question 7

Recent studies confirm that the elderly population seems to be willing to give up almost an entire year of average life expectancy in exchange for the reduction of variability in their life expectancy by 2 years.

Question 8

The law of diminishing marginal returns is a key theoretical contribution of The Malthusian Hypothesis.

Question 9

The law of diminishing marginal returns in The Malthusian Hypothesis means that the productivity of additional workers falls as the population increases. The cycle of technology improvements leading to increases in productivity which yield greater food supply ultimately results in the same level of subsistence living for agricultural workers as existed before the technology improvement.

Question 10

Population growth during the Demographic Transition in the Industrial Age is driven by declining mortality and increasing fertility.

Question 11

According to the text, medical care expenditures were slowly increasing from the Agricultural Age to the Industrial Age. At the end of the Agricultural Age, almost all expenditures on health care were driven by the 2% of the population that was wealthy. Greater equality of income and wealth distribution in the Industrial Age contributed to a faster increase in medical expenditures from that point on.

Question 12

The effect of income on health may vary across different age groups.

Question 13

Which of the following statements about the Agricultural Age is true?

A) The transition from Stone Age to Agricultural Age was characterized by changes in lifestyle from hunter-gatherer to farmers and resulted in increased life expectancy as the social structures of ancient civilizations such as the Sumerians, Greeks, and Romans provided stability and steady farm production.
B) The Agricultural Age is characterized by great income inequality and explosive population growth.
C) During the Agricultural Age income inequality and social stratification meant that farmers worked longer (compared to the Stone Age) hours to produce enough food to support themselves.
D) Demographic Transition during the Agricultural Age means that high infant and child mortality is usually accompanied by high birth rates and population increases occur.
E) The key theoretical contribution of The Malthusian Hypothesis is that droughts and war cause the decreases in farm productivity. This leads to increased mortality from starvation and naturally keeps the population from growing faster than the pace of technological progress.

Question 14

The Malthusian hypothesis

A) assumes that land resources change over time.
B) assumes that technology remains fixed.
C) assumes that technology gains outpace population increases over the long run.
D) proposes that population growth ultimately leads to declining labor productivity because land is a limited resource, so that increases in population result in less food for each person and more deaths.
E) argues that population growth leads to increasing labor productivity because land is a fixed resource.

Question 15

The necessary catalyst for development of social insurance programs for health care was the

A) rise of the middle class in the Industrial Age.
B) invention of HMOs in the Information Age.
C) increased disparity in life expectancy between income classes.
D) introduction of antibiotics.
E) the evolution of statistical methods in health care analysis.

Question 16

At which point in the history of mankind did societies start to experience the need to develop property rights?

A) Stone Age
B) Agricultural Age
C) Industrial Age
D) Information Age
E) The exact time point cannot be easily established by historians.

Question 17

At which point in history did spending on food not account for almost 100% of workers' budgets anymore?

A) Stone Age
B) Agricultural Age
C) Industrial Age
D) Information Age
E) The exact time point cannot be easily established by historians.

Question 18

The rise of economic science became possible only after the

A) invention of the science of epidemiology.
B) plague was conquered.
C) population growth rate reached the level when population doubled every 7,000 years.
D) investment and trade became possible.
E) invention of money, as a standard medium of exchange.

Question 19

Starting with the late 17^th century, the rise of economic science was associated with all of the following accomplishments, except

A) the first estimate of a nation's GDP (in England).
B) the first study of death statistics (in London), giving rise to the science of epidemiology.
C) publishing of the first book that offered economic analysis The Wealth of Nations by Adam Smith.
D) the discovery of the demographic transition cycle.
E) one of the first attempts at economic modeling and prediction by Thomas Malthus.

Question 20

What was the major contribution of Thomas Malthus to the economic thought?

A) discovery of regular trends in the GDP growth rates
B) discovering and formulating the law of diminishing returns
C) invention of the concept of economic statistics
D) discovery that food supply determines population
E) formulating the first theory of financial markets

Question 21

In which historical period did average life expectancy see the greatest increase?

A) Stone Age
B) Agricultural Age
C) Industrial Age
D) Information Age
E) The exact time point cannot be easily established by historians.

Question 22

Which of the following statements about the demographic transition is true?

A) Demographic transition is a characteristic of the Industrial and Informational ages only.
B) Demographic transition cycle happens about every 50 years.
C) Demographic transition is a characteristic of the Information Age only, and it happens only once.
D) The essence of the demographic transition is that economic development eventually changes the historical balance between death and birth rates significantly, leading to a rapid and dramatic population growth.
E) The essence of the demographic transition is that economic development eventually changes the historical balance between death and birth rates significantly, leading to a rapid and dramatic population decline.

Question 23

What does the statement Life is a "luxury good" mean in economic terms?

A) It was estimated that the value of life exhibits the income elasticity substantially greater than 1.
B) It was estimated that the value of life exhibits the income elasticity substantially smaller than 1.
C) It was estimated that the value of life exhibits the price elasticity substantially greater than 1.
D) It was estimated that the value of life exhibits the price elasticity substantially smaller than 1.
E) Only wealthy people can afford to buy significantly "more life" through investing more in medical care.

Question 24

Studies show that during the 20^th century the estimated value of life increased

A) only marginally.
B) by about 30%.
C) twofold.
D) significantly, quadrupling.
E) tremendously, by the magnitude of more than 3,000%.

Question 25

Which of the following statements about the Information Age is true?

A) As the world civilizations were sequentially moving through the Stone, Agricultural, Industrial and Informational ages, the average life expectancy has been slowly but steadily increasing.
B) Improvements in the quality of goods and services in the informational age are not easily captured by the common measures of nations' economic output, such as GDP.
C) Modern economists predict that somewhere around the year 2100 most countries in the word will attain the status of a developed country, with population growth rates in such countries stabilizing around 6%.
D) During the Information Age, the Malthusian Hypothesis still dominates thinking on population trends.
E) The examples of sharp declines in life expectancy and negative population growth rates can now be found only in the history of civilizations, not in the Information Age any more.

Question 26

What was the essential condition necessary for the early societies to start to grow?

Question 27

Use marginal analysis to explain why spending more to achieve a relatively small gain in life expectancy does make sense.

Question 28

What were the crucial assumptions in the Malthusian hypothesis that only with time were proven to be wrong?

Question 29

Evidence from the British medical service shows that life expectancy may vary not only between income classes, but even within the same income class, as it seems to additionally depend on rank as well. If all citizens have the same medical services available to them, could you provide some reasons why such disparities might exist. Use the concept of the production function of health to explain.

Question 30

When it comes to planning your future, the smaller is the risk of losing your wealth or health, the more secure you feel. Thus, reducing those risks is of value. Which factors would be important to you if you decide to estimate the value you would place on risk reduction?