How should the examinations be priced

Assignment Help Finance Basics
Reference no: EM13260778

Assume that a primary care physician practice performs only physical examinations. However, there are three levels of examinations I, II, III - that vary in depth and complexity. An RVU analysis indicates that a Level I examination requires 10 RVUs , a Level II exam 20 RVUs, and a Level III exam 30 RVUs. The total costs to run the practice, including a diagnostic laboratory, amount to $500,000 annually, and the numbers of examinations administered annually are 2,400 Level I, 800 Level II, and 400 Level III.

a. Using the RVU methodology, what is the estimated cost per type of examination?

b. If the goal of the practice is to earn a 20% profit margin on each examination, how should the examinations be priced?

 

Reference no: EM13260778

Questions Cloud

How organizations compete for resources : how organizations compete for resources, the consequences and costs of obtaining resources, and how resource attachment varies with the type of organization
Compute the vapor pressure of water in a solution : Calculate the vapor pressure of water above a solution prepared by dissolving 26.9 g of glycerin (C3H8O3) in 183 g of water at 343 K. Vapor Pressure (torr) at 343 (or 70) is 233.7 torr
Statements about cost : Total cost is the sum of all variable costs and fixed costs. the marginal cost curve always intersects the lowest point of average variable cost curve. Variable costs are the costs of producing the next unit of a good
How fast is the water shooting horizontally of the hole : A large tank opens to the air full of water has a small hole in it 2.0 m from the top. How fast is the water shooting horizontally of the hole
How should the examinations be priced : If the goal of the practice is to earn a 20% profit margin on each examination, how should the examinations be priced?
The backwards bending supply curve of labor : The backwards bending supply curve of labor is the result of ________ effect dominating when wages are low, ______ effect dominating at intermediate wages, and _______effect dominating when wages are high.
The quadratic formula is used to solve for x in expressions : The quadratic formula is used to solve for x in expressions taking the form of a quadratic equation: ax2 bx c = 0, Solve for x in the following expression using the quadratic formula
What is the electric feild in the middle : 3 charges (q1=2q, q2 = 3q, q3=-q ) where q = 1c , are arranged to form an equilateral triangle that is 10 cm on a side. What is the electric feild in the middle
Mathematical calculations : How did the European world move from an unknown, Earth- and man-centered universe determined by an omnipresent God to an incomprehensible universe run by natural laws and understood through mathematical calculations?

Reviews

Write a Review

Finance Basics Questions & Answers

  Computing yield to maturity for u.s. treasuries securities

Computing yield to maturity for U.S. Treasuries securities and examine the chart WSJ or IBD provides

  What is the projects pi

Bill plans to open a self-serve grooming center in a storefront. The grooming equipment will cost $385,000, to be paid immediately.

  Computation of unrealised gain or loss in market value

Computation of unrealised gain or loss in market value of trading securities and Prepare the required general journal entry for these transactions

  Segregation of duties

All Clear Corporation is a large manufacturer of custom draperies. In all, the company has seven divisions spread out across the country. Furthermore, the company has adopted a policy of issuing digital certificates for all corporation transactions,

  What is the current bond price

Ninja Co. issued 13-year bonds a year ago at a coupon rate of 7.9 percent. The bonds make semiannual payments. If the YTM on these bonds is 6.2 percent, what is the current bond price?

  Calculate the cash conversion cycle

Dan Barnes, financial manager of Ski Equipment Inc., is excited, but apprehensive. The company's founder recently sold his 51 percent controlling block of stock to Kent Koren, who is a big fan of EVA.

  Calculation of wacc with debt and preference and equity

Calculation of WACC with debt and preference and equity Shi faces a 40% tax rate If Shi has a target capital structure of 30% debt

  Determine earnings per share for 2009 and 2010

Because of the proceeds from these new shares and other operating improvements, earnings after taxes increased by 24 percent - Evaluate earnings per share for 2009 and 2010

  Competitive consequences of restructuring

In order to cut expenses when the dollar was at its peak, Caterpillar shifted production of small construction equipment overseas. By contrast, Caterpillar's main competitors in that area,

  Use appropriate method to solve the problem

In 1880 five aboriginal trackers were each promised the equivalent of hundred Australian dollars for helping to capture the notorious outlaw Ned Kelley.

  Pvs of cash flow

To find out the present value of uneven series of cash flows, you may find out the PVs of the individual cash flows and then sum them. Annuity procedures can never be of use, even if some of the cash flows constitute an annuity

  Compute of cost of capital

Compute of cost of capital and Calculate the cost of capital for the funds needed to meet the expansion goal and The firm expects to generate enough internal equity to meet the equity portion of its expansion needs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd