Prescribing Policies

1. Determine the following before deciding a prescription: (a)maximize effectiveness at the least cost; (b) maximizeeffectiveness at a fixed cost of $10,000; (c) achieve afixed-effectiveness level of 6,000 units of service at a fixed costof $20,000; (d) maximize net benefits, assuming that each unit ofservice has a market price of $10; (e) maximize the ration ofbenefits to costs, assuming that each unit of service has a marketprice of $10. 2. Determine which of the two main programs (ProgramI and Program II) should be selected under each of these criteria.Justify your position. 3. Describe the conditions under which eachcriterion may be an adequate measure of the achievement ofobjectives.

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