Question 1

Rent-seeking behavior results in&#10;A)increased economic activity by promoting efficiency.&#10;B)lower economic activity by diverting resource to less-productive uses.&#10;C)a more equitable distribution of income and wealth.&#10;D)lower prices throughout the economy.&#10;E)greater income and wealth in the private sector.

Accepted Answer

Rent-seeking behavior involves using resources to manipulate economic conditions for personal gain rather than creating value through productive economic activities. This results in the diversion of resources away from productive uses, leading to lower economic activity and inefficiencies.

Question 2

One of the primary reasons that costly technology is being introduced into the health care system is&#10;A)research scientists have successfully mapped the human genome.&#10;B)high cost is synonymous with better outcomes.&#10;C)third-party insurance finances most of the cost of care.&#10;D)all of the above.

Accepted Answer

The introduction of costly technology into the health care system is largely due to the fact that third-party insurance (e.g. Medicare, Medicaid, private insurance) is financing most of the cost of care. This creates a situation where providers can invest in expensive technology and pass on the cost to insurers and patients, without necessarily demonstrating that the added expense is improving outcomes or value. While the mapping of the human genome and the belief that high cost is synonymous with better outcomes may also be contributing factors, they are not the primary reason for the introduction of costly technology into healthcare.

Question 3

Of the new drugs introduced in the United States between 1940 and 1990, what percentage were discovered by U.S.firms?&#10;A)15.&#10;B)30.&#10;C)45.&#10;D)60.&#10;E)75.

Accepted Answer

According to the passage, 60% of the new drugs introduced in the United States between 1940 and 1990 were discovered by US firms.

Question 4

What is the most important factor leading to rising health care costs in the United States since 1980?&#10;A)The increased use of expensive medical technology.&#10;B)The aging U.S.population.&#10;C)The increased cost of malpractice insurance for providers.&#10;D)Rising incomes for physicians.&#10;E)The rising cost of pharmaceutical drugs.

Accepted Answer

The increased use of expensive medical technology, such as MRI and CT scans, has been a major contributor to rising health care costs in the United States since 1980. These technologies have significantly improved diagnosis and treatment, but they are also very expensive. As a result, the cost of healthcare has risen as the use of these technologies has become more widespread.

Question 5

The best description of the technological imperative is as follows:&#10;A)If the procedure is available, use it.&#10;B)If the procedure is available, use it if it works.&#10;C)If the procedure is available, use it no matter how much it costs.&#10;D)If the procedure is available and used, use it even if the patient can not afford it.

Accepted Answer

The answer of The best description of the technological imperative...

Question 6

Pharmaceutical companies receive patents as an exclusive right to produce a drug.This results in&#10;A)normal profits on the patented drug.&#10;B)monopoly status in the production of the drug.&#10;C)lower prices for patients requiring the drug.&#10;D)orphan drug status.&#10;E)fewer new chemical compounds discovered.

Accepted Answer

Patents grant pharmaceutical companies exclusive rights to produce a drug for a certain period of time, leading to a monopoly status in the production of the drug. This allows the companies to charge higher prices and generate profits to invest in research and development of new drugs. However, it can also limit competition and access to the drug for patients who cannot afford it.

Question 7

The regulatory agency with oversight responsibility for the pharmaceutical industry is the&#10;A)IRS.&#10;B)FDA.&#10;C)SEC.&#10;D)ITC.&#10;E)ATT.

Accepted Answer

The FDA (Food and Drug Administration) is responsible for regulating the pharmaceutical industry in the United States. The agency ensures that drugs are safe and effective before they can be marketed to consumers.

Deck 10: The Market for Pharmaceuticals