Question: Please answer as thoroughly as possible and explain all steps etc. The Center for Holistic Medicine is losing money each month. The leadership of the

Please answer as thoroughly as possible and explain all steps etc.

Please answer as thoroughly as possible and explain all steps etc. The

The Center for Holistic Medicine is losing money each month. The leadership of the center brainstormed and agreed that they should introduce a new service to the community. Beginning next month, the Center of Holistic Medicine would begin providing colonics to cleanse out bad toxins that harm an individual's spirit and state-of-mind. The new service will generate an additional 1,250 patient visits per month. The added visits will generate only $49.50 per visit. The new service will increase variable expenses across the board by 5%. (** = Variable Expenses). What are the marginal cost, marginal revenue, and marginal benefit of the new product line? (15 Points) Current Position (Monthly) REVENUE: Patient Revenues $357,500 Billable Patient Visits 6,620 EXPENSES: Nurse Salaries and Benefits * * $189,031 Support Staff Salaries * * $85,000 Support Staff Benefits * * $17,500 MIS ** $4,000 Laboratory ** $15,600 Radiology ** $3,214 Consumable Medical Supplies * * $15,000 Building and Occupancy $22,000 Furniture and Fixtures $5,578 Administration Supplies and Equip. $3,000 Liability Insurance Premiums $2,175 Consulting/Professional Fees $2,616 Promotion and Marketing ** $1,150 Interest Expense $500 Business and Property Insurance $900 Recruiting ** $2,800 Other Operating Expenses ** $1,936 Total Expenses: $372,000 NET INCOME ($14,500)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!