Scenario 2.2:
In 1992, the Occupational Safety and Health Authority passed the Bloodborne Pathogens Standard (BBP), which regulates dental office procedures. This regulation is designed to minimize the transmission of infectious disease from patient to dental worker. The effect of this regulation was both to increase the cost of providing dental care and to ease the fear of going to the dentist as the risk of contracting an infectious disease.
-Refer to Scenario 2.2. Under what circumstances will the equilibrium level of output of dental care increase?
A) If supply shifts more than demand.
B) If demand shifts more than supply.
C) If both demand and supply shift by the same magnitude.
D) If supply and demand both decrease.

Question

Quizplus · Accepted Answer

The regulation increased the cost of providing dental care, which led to a decrease in the supply of dental care. At the same time, it eased the fear of going to the dentist, which led to an increase in the demand for dental care. If the demand shifts more than the supply, the equilibrium level of output of dental care will increase.

Scenario 2.2: in 1992, the Occupational Safety and Health Authority Passed the Passed