MHA 710 Exam 1 | Questions with 100% Correct
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Terms in this set (109)
What is "economics"? A Map for decision making. Economics analyzes
the allocation of scarce resources.
What are some of the specific 1. The central roles of risk and uncertainty
challenges faced by managers in
healthcare? 2. The complexities created by insurance
3. The perils produced by information asymmetries
4. The problems posed by not-for-profit
organizations
5. The rapid and confusing course of technical and
institutional change
What does asymmetric information When one party in a transaction has less
mean? Can you give an example? information than the other party. For example,
physicians and other healthcare providers usually
understand patients' medical options better than
patients do. Unaware of their choices, patients may
accept recommendations for therapies that are not
cost-effective or, recognizing their vulnerability to
physicians' self-serving advice, may resist
recommendations made in their best interest.
,What is adverse selection? A situation that occurs when buyers have better
information than sellers. For example, high-risk
consumers are willing to pay more for insurance
than low-risk consumers are. (Organizations that
have difficulty distinguishing high-risk from low-risk
consumers are unlikely to be profitable.)
What is the problem of scarcity? Demand for a good or service is greater than the
availability
What does it mean to say people are focuses on individuals' efforts to best realize their
assumed to make choices rationally? goals, given their resources.
What does it mean to says resources Anything useful in consumption or production that
are scarce? has alternative uses.
What is opportunity cost? Potential loss from a missed opportunity. Passing
up the next best choice.
What does "marginal" refer to? The examination of the costs and benefits through
a small change in the production of goods
What does efficiency refer to? No way to rearrange production of goods in a way
that makes one person more better off without
making somebody else worse off. How well an
economy uses scare resources to meet the
needs/wants of their customers
How do positive economic Positive economics is objective while normative
statements differ from normative economics is subjective. Facts/ What is vs What
economic statements? should be
, How can economics be applied to Describe, Explain, Evaluate, Plan
the health sector?
As we progress through the Social determinants of health, few insurance
chapters, think about the special companies that providers rely on, not a perfectly
characteristics that apply to the competitive market
health sector that might limit the
applicability of traditional economic
models.
How are healthcare products both Products (goods and services are considered
outputs and inputs? Can you give an products) are commonly both inputs and outputs.
example? For example, a surgical tool is an input into a
surgery and an output of a surgical tool company.
Similarly, the surgery itself can be considered an
output of the surgical team or an input into the
health of the patient.
What is a life year? And what is it One additional year of life. It can equal one added
used for in the context of this year of life for an individual or an average of 1/nth
chapter? of a year of life for n people. An example is
spending $1 million by reducing childhood obesity
and saving thousands of lives or using if for
colonoscopies in 81 year old african american men
and saving few lives.
What are examples of interventions Interventions with the most include antismoking,
that have the most impact on life reducing childhood obesity, and multidisciplinary
years and those that have less measurement of heart failure. Interventions with the
impact? least include colonoscopies for african american
men who are 81 or 76 and multidisciplinary heart
failure measurement with exercise.
Answers | Verified | Latest Update 2026
Save
Terms in this set (109)
What is "economics"? A Map for decision making. Economics analyzes
the allocation of scarce resources.
What are some of the specific 1. The central roles of risk and uncertainty
challenges faced by managers in
healthcare? 2. The complexities created by insurance
3. The perils produced by information asymmetries
4. The problems posed by not-for-profit
organizations
5. The rapid and confusing course of technical and
institutional change
What does asymmetric information When one party in a transaction has less
mean? Can you give an example? information than the other party. For example,
physicians and other healthcare providers usually
understand patients' medical options better than
patients do. Unaware of their choices, patients may
accept recommendations for therapies that are not
cost-effective or, recognizing their vulnerability to
physicians' self-serving advice, may resist
recommendations made in their best interest.
,What is adverse selection? A situation that occurs when buyers have better
information than sellers. For example, high-risk
consumers are willing to pay more for insurance
than low-risk consumers are. (Organizations that
have difficulty distinguishing high-risk from low-risk
consumers are unlikely to be profitable.)
What is the problem of scarcity? Demand for a good or service is greater than the
availability
What does it mean to say people are focuses on individuals' efforts to best realize their
assumed to make choices rationally? goals, given their resources.
What does it mean to says resources Anything useful in consumption or production that
are scarce? has alternative uses.
What is opportunity cost? Potential loss from a missed opportunity. Passing
up the next best choice.
What does "marginal" refer to? The examination of the costs and benefits through
a small change in the production of goods
What does efficiency refer to? No way to rearrange production of goods in a way
that makes one person more better off without
making somebody else worse off. How well an
economy uses scare resources to meet the
needs/wants of their customers
How do positive economic Positive economics is objective while normative
statements differ from normative economics is subjective. Facts/ What is vs What
economic statements? should be
, How can economics be applied to Describe, Explain, Evaluate, Plan
the health sector?
As we progress through the Social determinants of health, few insurance
chapters, think about the special companies that providers rely on, not a perfectly
characteristics that apply to the competitive market
health sector that might limit the
applicability of traditional economic
models.
How are healthcare products both Products (goods and services are considered
outputs and inputs? Can you give an products) are commonly both inputs and outputs.
example? For example, a surgical tool is an input into a
surgery and an output of a surgical tool company.
Similarly, the surgery itself can be considered an
output of the surgical team or an input into the
health of the patient.
What is a life year? And what is it One additional year of life. It can equal one added
used for in the context of this year of life for an individual or an average of 1/nth
chapter? of a year of life for n people. An example is
spending $1 million by reducing childhood obesity
and saving thousands of lives or using if for
colonoscopies in 81 year old african american men
and saving few lives.
What are examples of interventions Interventions with the most include antismoking,
that have the most impact on life reducing childhood obesity, and multidisciplinary
years and those that have less measurement of heart failure. Interventions with the
impact? least include colonoscopies for african american
men who are 81 or 76 and multidisciplinary heart
failure measurement with exercise.
