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    Health economics problem - elasticity of firm-specific vs. general.

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    Firm-specific demand price elasticity's are higher than elasticity for demand in general because they are for a smaller group and are therefore more responsive to changes than the general market with a large pool, which is not as sensitive to variations.
    For example, when the price of physicians for a specific firm was increased by 1%, the physician's visits demanded by the patients decrease by 3.26%. In contrast, when the prices for the physician visits ...

    Solution Summary

    The elasticity of firm-specific versus general for health economics is examined.