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Assume that a radiology group has the following cost structure: Fixed costs: $750,000 Variable cost per procedure: $40 Furthermore, assume that the group expects to
Assume that a radiology group has the following cost structure:
Fixed costs: $750,000 Variable cost per procedure: $40
Furthermore, assume that the group expects to perform 10,000 procedures in the coming year.
- Define fixed and variable costs and provide examples for each.
- What are the groups expected total costs?
- What are the groups expected total costs at 7,000 procedures?
- What is the average cost per procedure at 7,000 procedures? At 10,000 procedures? What explains the difference?
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