1.3 The market demand for medical checkups per day is OF = 25(198 + nc/20,000 - p;), where ne is the number of patients per day who are at least 40 years old, and p is the price of a checkup. The market demand for the number of dental check- ups per day, Qy, is Or = 100(150 - p,1/3, where py represents the price of a dental checkup. The long-run market supply of medical checkups is OF = 50p - 10p.. The long-run market supply of dentists is QT = 50p, - 10p. The supplies are linked because people decide on a medical and den- tal career based in part on relative earnings. a. If n = 40,000, what is the equilibrium number of medical and dental checkups? What are the equilibrium prices? How would an increase in affect the equilibrium prices? Determine dp /doc and dp /dac b. Suppose that, instead of determining the price of medical checkups by a market process, large health insurance companies set their reimbursement rates, effectively determining all medical prices. A medical doctor receives $35 per checkup from an insurance company, and a patient pays only $10. How many checkups do doctors offer collectively? What is the equilibrium quantity and price of dental checkups? c. What is the effect of a shift from a competitive medical checkup market to insurance-company- dictated medical-doctor payments on the equilib rium salaries of dentists? M