Some goods are considered perfect complements. We discussed the example of left and right shoes. The same could be said for physician and nursing services. Assume that the utility derived from health care requires equal amounts of physician and nursing services.

a.Draw the indifference curves labeling one axis physician services and one nursing services assuming they are perfect complements.

b.Assume that the price of physician services is $50 per unit and the price of nursing services is $25 per unit; draw the budget constraint for $750.

c.Assuming the entire budget of $750 is spent on physician and nursing services, how much of each will maximize utility with the assumptions above?

d.How realistic are the assumptions of these being perfectly complementary services? Come up with another example of complementary (though not necessarily perfectly complementary) health care services.