HGMT 435 UMUC Health Care Economics Discussion

1.  What are the characteristics of a perfectly competitive market?

2. What is the difference between variable and fixed costs, how do they change in short-run vs. long-run? Provide an example in healthcare.

3.  What does increasing returns mean in the short-run? Provide an example of increasing returns?

4.  From an economic perspective, at what point does a firm decide to shut-down? Explain.

5.  When a market is perfectly competitive what does this imply about the supply curve and the price charged for a particular good?

6.  What is the level of profits in the long-run in a perfectly competitive market? Explain why.

7.  What is the difference between an economic and accounting profit?

8.  What is the principle of diminishing marginal return?