What is the volume of indifference

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A hospital is evaluating whether to outsource or perform in-house a large set of blood and urine lab tests. The fixed cost of the laboratory located in the hospital is $800,000. and the weighted average variable cost per test if performed in house is $28.75. A third party lab located one city block form the hospital will perform the same tests and distribute the results electronically to the hospital at a price of #32.00. IF the annual volume last year was 250,000 tests, what should the hospital do? What is the volume of indifference?

Reference no: EM131231830

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