1. What is the primary economic principle that underlies the concept of managed care in healthcare? - A) Supply and demand - B) Cost-benefit analysis - C) Risk sharing - D) Resource allocation Answer: C) Risk sharing Rationale: Managed care is designed to distribute the financial risk of healthcare across a larger group, thereby reducing costs for individuals. 2. How does the elasticity of demand for healthcare services affect pricing strategies? - A) Inelastic demand allows for higher pricing. - B) Elastic demand correlates with lower pricing. - C) Demand elasticity does not affect pricing. - D) Both A and B