1. Suppose a business school undergraduate were able to find a job right out of college that pays 70K per year. If this same student instead pursued an MBA which takes 2 years, what is the cost to the student of the investment in the MBA when the interest rate is 10%?
   1. The present value of tuition, and room and board which is $42K.
   2. At most $134K
   3. At least $176K
   4. $134K
2. A graduating GP expects to earn $220K per year. As a gastroenterologist she would earn $320K per year. If the gastroenterology specialty requires three additional years of training, does the higher income justify the 3-year investment if the interest rate were zero?
3. Suppose a disgruntled patient sues her physician for negligence. The physician has malpractice insurance. How would insurers incentivize physicians to use reasonable care in surgery? What are provisions of malpractice insurance.
4. Group practices are simply cartels.
   1. True
   2. False
5. Many physicians in rural areas possess market power. Is price discrimination evidence of control over price?
6. Which of the following is not required for successful price discrimination:
   1. Asymmetric information.
   2. Market segmentation
   3. Competition
   4. Product or service resale.
7. Physicians are imperfect agents for their patients because patients lack the knowledge to evaluate physician advice. This imperfection is exacerbated by the physicians dual role as practitioner and diagnostician.
   1. True
   2. False
8. Physicians object to evidence-based medicine why? Are patients in agreement with their doctors in this regard?
9. Hospitals exert monopsony power over nurses according to the text. If correct does this provide justification for nurse cartels?

1. Do you think that dentists would support more dental insurance? Why?