1) Lichtenberg (2001) estimated the benefits and costs of newer drugs. Their results are summarized as follow:

a. Based on the above findings, identify the benefits of using newer drugs.

b. Given the above information, do you have enough information to conduct a CBA for using newer drugs? Justify your answer.

Expenditure Type Mean Effect of Switching from 15 Year-Old Drugs to 5.5-Year-Old Drugs on Expenditures for Entire Population (in US$) Mean 18 -80 -12 Prescription drugs Hospital Home health care Office visits Outpatient Emergency room -24 -10 -3 Expenditure Type Mean Effect of Switching from 15 Year-Old Drugs to 5.5-Year-Old Drugs on Expenditures for Entire Population (in US$) Mean 18 -80 -12 Prescription drugs Hospital Home health care Office visits Outpatient Emergency room -24 -10 -3