A new cardiac catheterization lab was constructed at Havea Heart Hospital. The investment for the lab was $450,000 in equipment costs and $50,000 in renovation costs. A desired return on investment is 12%. Once the lab was constructed, 5,000 patients were served in the first year and were charged $340 for each procedure. The annual fixed cost for the catheterization lab is $1,000,000 and the variable cost is $129 per procedure. a. What is the lab's profit? b. Calculate the ROI for the catheterization lab. b. Does the profit generated meet the hospital's the required ROI? Enter Yes or No for your answer.
A new cardiac catheterization lab was constructed at Havea Heart Hospital. The investment for the lab was $450,000 in equipment costs and $50,000 in renovation costs. A desired return on investment is 12%. Once the lab was constructed, 5,000 patients were served in the first year and were charged $340 for each procedure. The annual fixed cost for the catheterization lab is $1,000,000 and the variable cost is $129 per procedure. a. What is the lab's profit? b. Calculate the ROI for the catheterization lab. b. Does the profit generated meet the hospital's the required ROI? Enter Yes or No for your answer.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A new cardiac catheterization lab was constructed at Havea Heart Hospital. The investment for the lab was $450,000 in equipment costs and $50,000 in renovation costs. A desired
a. What is the lab's profit?
b. Calculate the ROI for the catheterization lab.
b. Does the profit generated meet the hospital's the required ROI? Enter Yes or No for your answer.
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