Assume that a radiology group practice has the following cost structure:

Furthermore, assume that the group expects to perform 7,500 procedures in the coming year

a. What is the group’s underlying cost structure?

b. What are the group’s expected total costs?

c. What are the group’s estimated total costs at 5,000 procedures? At 10,000 procedures?

d. What is the average cost per procedure at 5,000, 7,500, and 10,000 procedures?

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Fixed costs $500,000 = Variable cost per procedure $25 =