Figure 7-2

Figure 7-2 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services.
-Refer to Figure 7-2.The efficient price of medical services is

Question

Figure 7-2
  
Figure 7-2 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services.
-Refer to Figure 7-2.The efficient price of medical services is

Quizplus · Accepted Answer

The efficient price of medical services is where the marginal cost and marginal benefit intersect, which is at point E. At this point, the price is $40, and the quantity of medical services demanded is Q*. Therefore, the best choice is B.

Figure 7-2 Figure 7-2 Represents the Market for Medical Services with and for Medical