QUESTION 11 The demand for a good or service rises if at every price people are
ID: 1195992 • Letter: Q
Question
QUESTION 11
The demand for a good or service rises if at every price people are willing and able to purchase more than they did previously. The reason the demand for health care has risen is
that the price of health care has fallen due to technological change.
third party payment system has increased people's ability to purchase more.
that the price of health care has fallen while the quality has risen.
that the quality of health care has risen.
third party payment system has increased people's willingness to purchase more.
that the price of health care has fallen due to technological change.
third party payment system has increased people's ability to purchase more.
that the price of health care has fallen while the quality has risen.
that the quality of health care has risen.
third party payment system has increased people's willingness to purchase more.
Explanation / Answer
It has been stated that demand for a good or service rises if at every price people are willing and able to purchase more than they did previously.
If we analyze the health care market then we can see that advent of health insurance has increased the ability of general public to purchase health care. By taking a helath insurance policy, people, in general, are safeguarding themselves against huge out-of-pocket healthcare expenditure.
Apart from this, health insurance also induce them to go for medical procedure which they would not in absence of health insurance as health insurance has made them able to afford such procedures.
Thus, it can be said that third party payment system (health insurance system) has increased both willingness and ability of people to purchase more healthcare.
Hence, both option (2) and (5) are correct answer.
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