MPH 657 Mod 4 solutions

In the figure m1 quantity consumed with no insurance

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Unformatted text preview: when she or he moves from no indemnity payment to a $25 flat payment. This is reflected graphically with a parallel shift of the demand curve. In the figure, m1 = quantity consumed with no insurance m2 = quantity consumed when indemnity payment of p* per unit (in this case $25) As you can see consumption increases. 2. Demands for medical care are specific to each illness, and each illness can create demand for more than one type of medical care (e.g.,...
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