Suppose that the average annual malpractice cost is $40,000 for reckless doctors and $1,000 for careful doctors. If half of an insurance company's insured doctors are reckless, the company will earn zero economic profit if the price of insurance is $(Enter your response as an integer.) If careful doctors are not willing to pay more than $7,000 for insurance, the price required for zero economic profit is $ (Enter your response as an integer.)

Suppose that the average annual malpractice cost is $40,000 for reckless doctors and $1,000 for careful doctors. If half of an insurance company's insured doctors are reckless, the company will earn zero economic profit if the price of insurance is $(Enter your response as an integer.) If careful doctors are not willing to pay more than $7,000 for insurance, the price required for zero economic profit is $ (Enter your response as an integer.)

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter4: Economic Evaluation In Health Care

Section: Chapter Questions

Problem 4QAP

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