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Question
Through the Medicaid program, the U.S. government is the primary provider of health insurance for the poor (although not all of the poor in need of health care insurance are able to participate in this program). In this situation, the government is
a. a monopsonist that imposes price controls to reduce overall cost.
b. a monopsonist that allows providers to charge whatever they want but imposes quality controls.
c. a monopolist that imposes price controls to reduce overall cost.
d. a monopolist that imposes price controls to increase overall quality.
e. both a monopolist and monopsonist that makes active use of price controls.
Answer
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