Three Hospitals Are Located Within the Same Metropolitan Area

question 99

Multiple Choice

Three hospitals are located within the same metropolitan area. One hospital determined that both its cafeteria and its gift shop ranked lower in variety and convenience than the other two hospitals. Which of the following actions would be most appropriate?

• A) Normalize the data based on any significant differences in the customers being served (for example, economic strata).
• B) Subcontract the cafeteria and gift shop to outside sources that can provide greater attention to these nonmedical aspects of the hospital operations.
• C) Collocate the cafeteria and the gift shop in order to share resources, reduce costs, simplify access, and allow a greater investment in variety.
• D) Look at customer purchasing patterns and profit margins to maximize investment payback.

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Definitions:

Profit-maximizing

The approach a corporation takes to ascertain the price and quantity of output that yields the maximum profit.

Profit-maximizing Price

The price level at which a firm can make the maximum profit, considering its cost structure and demand for its products.

Pure Monopolist

A market situation in which a single company owns all the market share for a product or service, without any competitors.

Demand Data

Information or statistics regarding the desire of consumers to purchase goods or services at various prices over a given period.