Non-profit institution. The City of Vancouver makes an $850,000 lump-sum budget appropriation to run a safe injection site for a year. All the appropriation is to be spent. The variable costs average $16 per patient visit. Fixed costs are $500,000 per year.
1. Compute the number of patient visits that the budget allocation will cover.
2. Suppose the total budget for the following year is reduced by 10%. Fixed costs are to
remain the same. The same level of service on each patient visit will be maintained.
Compute the number of visits that could be provided in a year.
3. As in requirement 2, assume a budget reduction of 10%. Fixed costs are to remain the
same. By how much would variable costs have to decline in order to provide the same
number of visits?

  • CreatedJuly 31, 2015
  • Files Included
Post your question