As the Medicare program is expanded to cover the cost of prescription drugs for the elderly, other things constant, this will lead to
A) an increase in demand and higher prices for prescription drugs.
B) an increase in demand and lower prices for prescription drugs.
C) reduction in demand and lower prices for prescription drugs.
D) reduction in demand and higher prices for prescription drugs.

Question

Quizplus · Accepted Answer

When Medicare covers more costs, more elderly people can afford prescription drugs, increasing demand and potentially raising prices.

As the Medicare Program Is Expanded to Cover the Cost