Question
You provide IV infusion services, focusing on services that are not covered by health insurance. Your monthly overhead is $2,300. You value your time at
You provide IV infusion services, focusing on services that are not covered by health insurance. Your monthly overhead is $2,300. You value your time at $50 per half hour (you can run 4 infusions per half hour). Supplies per infusion cost $6. You currently charge $140 per infusion and have a volume of 300 clients per month. Your research tells you that a 6 percent reduction in prices will result in a 9.5 percent increase in volume. What would happen to your volume, revenues, and profits if you cut your price to $131.60? What about if you raised your price to $152?
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