What are the problem with Medicare and Medicaid?
What will be an ideal response?
The government expenditure on Medicare and Medicaid are determined by the quantity of healthcare demanded, not by a fixed government budget. The scale of expenditure on Medicare and Medicaid in the United States is much than that in other rich nations. The U.S. population is aging. Older people demand more healthcare services than do younger people. Consequently, without changes in the Medicare and Medicaid programs, the expenditure on these programs, already huge, will increasingly grow.
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A college must decide if it wants to offer more adult literacy classes. This decision involves answering the economic question of "what to produce."
Indicate whether the statement is true or false
Which is a major criticism of a monopoly as a source of allocative inefficiency?
A. A monopolist will always make profits and that means that prices are too high. B. A monopolist has an unfair advantage because it can purchase labor at a lower price than competitive firms in other industries. C. A monopolist has no incentive to produce efficiently because even the inefficient monopolist can be assured of economic profits. D. A monopolist fails to expand output to the level where the consumers' valuation of an additional unit is just equal to the monopolist's opportunity cost.