Problem 1: What are the unique characteristics of the health care sector that create inefficiencies in the market? What kind of inefficiencies? Why?
Problem 2: In general, what two metrics would you use to evaluate trade-offs of spending more on health care vs. other non-healthcare goods? Why?
- Scarcity
- Opportunity cost
Problem 3: From a government (policymakers) perspective, apply these two metrics to the current excessive health care spending and explain your conclusions.