Prescription drug use

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1. Studies have found that higher levels of prescription drug use are positively correlated with life expectancies. This means that:Select one:a. countries should shift their spending from education to prescription drugs. b. people with higher incomes consume more prescription drugs. c. prescription drugs are productive in improving people’s health. d. national health insurance leads people to buy more prescription drugs. 2. If a physician halves office space and staff, and average costs _______, than _______ of scale are present.Select one:a. decrease; economies. b. increase; economies. c. decrease; diseconomies. d. answers b and c are both correct. 3. If a hospital has economies of scale with respect to production, then:Select one:a. it must have economies of scope. b. it cannot have economies of scope. c. it can only have economies of scope for those activities for which it has economies of scale. d. it may or may not have economies of scope. 4. If a hospital has economies of scale with respect to production, then:Select one:a. it must have economies of scope. b. it cannot have economies of scope. c. it can only have economies of scope for those activities for which it has economies of scale. d. it may or may not have economies of scope. 5. If a hospital has economies of scale with respect to production, then:Select one:a. it must have economies of scope. b. it cannot have economies of scope. c. it can only have economies of scope for those activities for which it has economies of scale. d. it may or may not have economies of scope. 6. If a hospital has economies of scale with respect to production, then:Select one:a. it must have economies of scope. b. it cannot have economies of scope. c. it can only have economies of scope for those activities for which it has economies of scale. d. it may or may not have economies of scope. 7. If the price elasticity of demand for visits is -0.2, then a 10% increase in price leads to a ____ in quantity demanded.Select one:a. 20% decrease b. 2% increase c. 2% decrease d. 20% increase

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