Question 54 4 pts Cheyenne manages the Pulmonary Lab in a large hospital. The staff and...

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Question 54 4 pts Cheyenne manages the Pulmonary Lab in a large hospital. The staff and doctors have asked Cheyenne to include 5 new treadmills in the budget for the next year. Cheyenne knows that in such a large system, it is going to take some convincing to succeed at obtaining all 5 treadmills, so she decides to calculate the net present value of the purchase with her budget proposal. The cost of all the treadmills, which will be purchased at once, is $250,000. She also knows that they will certainly be used for at least the next five years. Cheyenne estimates that the net profit per pulmonary test, after adjusting for contractual allowances, will be $100. She also estimates that the applicable rate of interest for the hospital is 3 %, compounded annually. The staff provided Cheyenne with their best estimate of the increase in testing that could be performed over five years: Year 1 Year 2 Year 3 Year 4 Year 5 Number of 500 1,500 2,400 2,400 2,400 Additional Tests Net Annual $50,000 $150,000 $240,000 $240,000 $240,000 Profit Present Value Factor at 0.97087 0.94260 3% 0.91514 0.88849 0.86261 interest The net present value of purchasing the treadmills [Select] $829,823 $920,000 Based on the numbers, Cheyenne is [Select] treadmills. $850,000 roval to purchase the Question 54 4 pts Cheyenne manages the Pulmonary Lab in a large hospital. The staff and doctors have asked Cheyenne to include 5 new treadmills in the budget for the next year. Cheyenne knows that in such a large system, it is going to take some convincing to succeed at obtaining all 5 treadmills, so she decides to calculate the net present value of the purchase with her budget proposal. The cost of all the treadmills, which will be purchased at once, is $250,000. She also knows that they will certainly be used for at least the next five years. Cheyenne estimates that the net profit per pulmonary test, after adjusting for contractual allowances, will be $100. She also estimates that the applicable rate of interest for the hospital is 3 %, compounded annually. The staff provided Cheyenne with their best estimate of the increase in testing that could be performed over five years: Year 1 Year 2 Year 3 Year 4 Year 5 Number of 500 1,500 2,400 2,400 2,400 Additional Tests Net Annual $50,000 $150,000 $240,000 $240,000 $240,000 Profit Present Value Factor at 0.97087 0.94260 3% 0.91514 0.88849 0.86261 interest The net present value of purchasing the treadmills [Select] $829,823 $920,000 Based on the numbers, Cheyenne is [Select] treadmills. $850,000 roval to purchase the