Jamestown Clinic had the fixed and variable costs shown on the bottom of this page.
a. What are the fixed, variable, total, and average costs per patient for volumes of 100, 500, 1,500, 2,500, and 3,000?
b. Draw a graph of the average cost per patient. Plot cost on the vertical axis and the number of patients on the horizontal axis.
c. An outside organization, such as a health maintenance organization, offers to send Jamestown 500 patients per year but only offers to pay $ 300 for each one. Should Jamestown agree to this arrangement? It currently has 2,500 patients per year and can easily handle 3,000.