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?

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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? HGMT 435 UMUC Health Care Economics Discussion