2) Quality Adjusted Life Year (QALY) Calculations The Federal Drug Administration (FDA) must choose among three experimental drugs that attack the symptoms of a disease but may have side effects. The drugs are as follows: Drugs A and B are mutually exclusive (if I use one, I have no need of the other ever) and Drug C is independent of A and B (the use of Drug C says nothing about if we could use Drugs A and B). Drug A has a cost of $1,000,000 and extends life by 60 QALYs (quality-adjusted life- years). - Drug B has a cost of $50,000 and extends life by 40 QALYs. Drug C has a cost of $1,500,000 and extends life by 80 QALYs. Are its decisions consistent if the agency chooses Drug B only? If so, what can we say about the implicit value placed on a quality-adjusted life-year? Are its decisions consistent if the agency chooses Drugs A and C? If so, what can we say about the implicit value placed on a QALY? a) b)