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The Observation That an Increase in the Supply of Physicians

Question 3

Multiple Choice
The observation that an increase in the supply of physicians to an area is matched by an increase in the price of physicians' services (rather than a price decrease)can be explained via the supplier-induced demand hypothesis.Which of the following is also a plausible explanation for this observation?

The observation that an increase in the supply of physicians to an area is matched by an increase in the price of physicians' services (rather than a price decrease) can be explained via the supplier-induced demand hypothesis.Which of the following is also a plausible explanation for this observation?


A) An increase in the supply of physicians reduces time and travel costs to consumers,causing demand to increase
B) An increase in the supply of physicians increases consumers' perceptions of the quality of health care available,causing demand to increase
C) An increase in the supply of physicians may correspond to a contemporaneous increase in demand for reasons such as an aging population or rising consumer incomes
D) All of the above

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