If more insurance companies decide to cover part of the price of voluntary laser eye surgery and more doctors decide to enter the field of laser eye surgery, what will happen in the market for laser eye surgery as a result of these two factors?
A)Demand will increase, but these two factors will not shift the supply curve.
B)Supply will increase, but these two factors will not shift the demand curve.
C)Demand and supply will both increase.
D)Demand will increase and supply will decrease.

Question

Quizplus · Accepted Answer

If more insurance companies cover part of the price of voluntary laser eye surgery, it will lead to an increase in demand for the service because it will become more affordable for consumers. More doctors entering the field of laser eye surgery will increase the supply of the service. Therefore, both factors will work together to increase both demand and supply in the market for laser eye surgery.

If More Insurance Companies Decide to Cover Part of the Price