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Based on Pauly-Redisch model, analyze the effects of the following exogenous changes on the optimal number...

Based on Pauly-Redisch model, analyze the effects of the following exogenous changes on the optimal number of physicians on a hospital’s medical staff. Use a graph to answer each of the questions.

(a) an increase in the wage rate of the hospital’s employees

(b) an increase in the number of persons with health insurance coverage in the hospital’s market area

(c) implementation of a fixed dollar subsidy per unit of hospital care by the city government.

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