Question

nder current law, money that you or your employer spend on your health insurance isn't included in your income tax. Robert is an economist at a think tank who has developed a theory: if those insurance contributions WERE taxed, people would shop around more for insurance and insurance costs would fall.To test his theory, which approach is Robert likely to use

Answer 1

Answer: d. Look for a time in the past when taxes on insurance changed (while little else changed), and observe how choices changed before and after.

Step-by-step explanation:

It is a very well known fact that economists do not agree on a lot of issues due to the different classes they follow. Should other economics review Robert's work, they would find logical inconsistencies regardless so option A is not the best approach.

Options B and C are not that much better because they would require a lot of resources and would be very hard to implement as well. Not to mention option C would be skipping the testing stage entirely.

Best option would be D. If Robert is so opportune to find a time in the past where insurance contributions were taxed then he would be able to observe how choices changed before and after. This is practical and would be the best approach.