For an individual who consumes only two goods, X and Y, the opportunity cost of consuming one unit of X in terms of how much Y must be given up is reflected in
a. the individual's marginal rate of substitution.
b. the slope of the individual's budget constraint.
c. the slope of the individual's indifference curve.
d. None of the above.
QUESTION 2All of the following describe the conflict between divisions EXCEPT
a. Divisional managers are rewarded for the efficiency of their divisions
b. managers of profit centers care too little about the effects of their decisions on other divisions
c. managers are rewarded only for how well their own division is run
d. corporate executives cannot tell when one divisional manager's decision is appropriate or not
QUESTION 3Capitation
a. creates pressures to provide fewer services.
b. is a fixed payment determined in advance to pay for all medically-necessary care.
c. is the maximum allowable fee in a fee-for-service system.
d. shifts financial risk onto patients.
e. Both a and b are correct.
QUESTION 4Indifference curves
a. are nonintersecting.
b. are contour lines of a utility function.
c. are negatively sloped.
d. All of the above.
QUESTION 5Conflicts can arise between divisions because
a. some activities across divisions benefit from coordination
b. managers of profit centers care too little about the effects of their decisions on other divisions
c. managers are rewarded only for how well their own division is run
d. all of the above
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