Question

Growth and development Economics

Consider the relationship between health and income. a. In what way(s) is health and income related?

b. Use a diagram to show this relationship and denote the equilibrium level of health and income.

c. How does this equilibrium change if there in an exogenous improvement in health? Show this new equilibrium in your diagram.

d. Provide a realistic example that would result in this exogenous improvement in health.

Answer 1

1. Health and Income are related in many ways, some of them are: -

Speaking of generally, if we are having more income we will live in a place which is less free to diseases and pathogens. You will also eat healthy food where you can increase your life expectancy. All your economy issue will be done so that you will be stress free. There is a survey also that people with more income will have less probability of heart strokes. Lastly the basic thing is that if we are having more money we will tack care of ourselves.

2. Use a diagram to show this relationship and denote the equilibrium level of health and income.

Equilibrium level of income is the stage where our income levels to what we earn to what we loss.

Equilibrium level of health is the place where our income maintains our stable helath

While we observe the graph below we can find the equilibrium at 45 and 70 in that we can find the equilibrium level of health and income.

c. How does this equilibrium change if there in an exogenous improvement in health? Show this new equilibrium in your diagram.

Exogenous reasons are the activities which increases the life expectancy of people irrespective of income due to vaccination and due to increase in employment opportunities and due to eradication of diseases and county makes cleanliness programs and provides free house and neat environment. We can simplify as the external factors which influence the expectancy.