2) If the demand for crude oil decreases but the supply of oil decreases more than the demand decreases, the equilibrium price of oil will decrease.

A - True

B - False

3) Which of the following best explains why a patient would be willing to undergo a caesarean section when the price of the procedure is over $60,000 when the price for same procedure for another patient is less than $7,000?

A - The patient charged the higher price believes the medical staff used for her procedure is superior to the staff used for the lower-priced procedure.

B - Willingness to pay the higher price is an example of the "snob effect" whereby the patient wishes to pay for a service another patient could not afford.

C - The patient charged the higher price is given a private recovery room in the hospital; the patient charged the lower price must share a recovery room with another patient.

D - A caesarian section procedure is a Giffen good.

E - The cost of the procedure is covered by the patient's health insurance.

8) A market glut, or surplus, results when the demand for a product increases more than the supply of the product increases.

A - True

B - False

10) The demand for a medical procedure that is covered a patient's health insurance will be more elastic than the demand for the same procedure if it is not covered by the patient's health insurance.

A - True

B - False