Question

North Central Bronx hospital has estimated the following costs for its in-patient services Fixed cost $12,000,000 Variable cost per inpatient day $300 North Central Bronx hospital expect to have 18,000 in patient day neat year, » What is the hospital's underlying cast structure? B. What are the hospitals expected total cost? What is the hospital's estimated to tal cost at 19000 inpatient days? At 25,000 patient day? Do what is the average cost per patient day at 19,000, 25000 and 30,000 patient days?

Answer 1

Statement showing Computations
Particulars	Amount
a) Underlying cost structure = 12,000,000 + 300x
b) Hospital expected total cost = 12,000,000 + 18000*300	17,400,000.00
c)
Cost at 19,000 Patient days = 12,000,000 + 300*19000	17,700,000.00
Cost at 25,000 Patient days = 12,000,000 + 300*25000	19,500,000.00
Cost at 30,000 Patient days = 12,000,000 + 300*30000	21,000,000.00
d)
Average cost 19,000 Patient days = 17.7M/19000	931.58
Average cost 25,000 Patient days = 19.5M/25000	780.00
Average cost 30,000 Patient days = 21M/30000	700.00