1. Ten physicians have just completed their residencies in internal medicine and are considering opening a group practice. They estimate the practice would have the following annual cost structure: annual fixed costs = $750,000 and variable cost per visit = $50. If volume in the first year is estimated to be 10,000 visits, what price per visit must be set if the practice wants to make an annual profit of $150,000?

1. $125
2. $50
3. $140
4. $90
5. $75

1. Ten physicians have just completed their residencies in internal medicine and are considering opening a group practice. They estimate the practice would have the following annual cost structure: annual fixed costs = $750,000 and variable cost per visit = $50. If volume in the first year is estimated to be 10,000 visits, what price per visit must be set if the practice wants to achieve accounting breakeven (e.g., profit = $0)?

1. $140
2. $125
3. $75
4. $50
5. $90