HEALTHCARE FINANCE TOPIC

Please explain why? I want to make sure that my answers are correct.

1. Smith Pharmaceuticals is trying to estimate the breakeven volume of sales on a newly developed drug. Which of the following would be expected to reduce the number of pills Smith would need to sell to breakeven (i.e., which would result in a lower breakeven volume) assuming everything else remains the same? a. An increase in total fixed costs b. A decrease in the selling price per pill c. An increase in the variable cost per pill d. An increase in the unit (per pill) contribution margin e. An increase in allocated overhead (indirect) costs Expain! 2. Assume the local children's hospital implements an outpatient asthma intervention to improve the health outcomes of children with asthma. As a result, the hospital sees a dramatic reduction in the number of inpatient admissions for children with asthma, but very little change in the total cost of operating the hospital. Which of the following statements describes the most likely reason for the lack of cost savings? a. The hospital's cost structure primarily consists of variable costs b. The hospital's cost structure primarily consists of fixed costs c. The hospital's cost structure consists of an equal mix of variable and fixed costs d. The hospital reduced its capacity (i.e., downsized) following the drop in admissions e. The hospital has a very high variable cost per admission. Explain! 3. Seattle Radiology Group plans to invest in a new CT scanner. The group estimates $1,500 net revenue per scan. Preliminary market assessments indicate that demand will be less than 5,000 scans per year. The group is considering a scanner (Scanner B) that would result in total fixed costs of $800,000 and would yield a profit of $450,000 per year at a volume of 5,000 scan:s What is the estimated breakeven volume (in number of scans) for Scanner B? a. 3,200 b. 160 c. 834 d. 5,000 | e. 250 Explain 4. True or False: In general, the best way to allocate costs in a large organization is to assign all overhead expenses to a single cost pool with one cost driver. Why