Assume that health insurance is private in a country, and the market for insurance iscompetitive. The figure below shows the marginal benefit and willingness and abilityto pay curve.2Premium (thousands of dollars per year)$10 million.$20 billion.$10 billion.$20 million.8620D = MB105020 30 40Quantity (millions of families insured)Suppose that the marginal social benefit of insurance exceeds the willingness andability to pay by a constant $2,000 per family per year. Suppose the marginal cost ofhealth insurance is a constant $8,000 a year. What is the deadweight loss created?

The market equilibrium quantity is where the private marginal benefit curve intersects the private…

Assume that health insurance is private in a country, and the market for insurance is competitive. The figure below shows the marginal benefit and willingness and ability to pay curve. Premium (thousands of dollars per year) $10 million. $20 billion. $10 billion. $20 million. 9 2 10 D = MB 20 30 40 50 Quantity (millions of families insured) Suppose that the marginal social benefit of insurance exceeds the willingness and ability to pay by a constant $2,000 per family per year. Suppose the marginal cost of health insurance is a constant $8,000 a year. What is the deadweight loss created?

Assume that health insurance is private in a country, and the market for insurance is competitive. The figure below shows the marginal benefit and willingness and ability to pay curve. Premium (thousands of dollars per year) $10 million. $20 billion. $10 billion. $20 million. 9 2 10 D = MB 20 30 40 50 Quantity (millions of families insured) Suppose that the marginal social benefit of insurance exceeds the willingness and ability to pay by a constant $2,000 per family per year. Suppose the marginal cost of health insurance is a constant $8,000 a year. What is the deadweight loss created?

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter6: Population Health

Section: Chapter Questions

Problem 2QAP

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