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Determine what capital charge per procedure hospital charge

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Problem 1: You have acquired a new CT scanner at a cost of $750,000. You expectto perform 7,000 procedures per year over the estimated 5-year life of the scanner. Assuming no salvage value and an annual increase in replacement cost of 10 percent, what capital charge per procedure should the hospital charge levy to provide for replacement cost in the second year? (Ignore financing costs and investment income offsets.)

Reference no: EM132675945

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