Use the Following Information to Answer the Questions Below

question 38

Multiple Choice

Use the following information to answer the questions below.
In the process of long-range planning at Rocky Mountain Hospital, Health Information Services defined its future business opportunities.A commitment was made to an optical imaging system and service to be implemented at the first of the year.The system would have the capacity for serving physician offices through a space rental and service program in addition to meeting the needs of the department.It was estimated by the health information manager that the hardware and software components of the optical imaging system would cost approximately $100,000 (with an estimated useful life of 5 years) , and a 3-year lease for one van (with a useful life of 5 years) would cost $7000 annually.The goal was to service 100 offices the first year, 200 offices the second year, and 300 offices the third and successive years at $150 a month.The accounting department uses straight-line depreciation; that is, equal amounts of depreciation expenses are recognized for each year the asset is assumed to be used.
-The _____ officer (of the four employed by the institution) will most likely be responsible for obtaining the financing for the new imaging system and service, if it is necessary, including developing the investment report showing this new service.

• A) Chief financial
• B) Managerial finance
• C) Patient account
• D) None of the above

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Definitions:

X-Inefficiency

A situation in which a firm fails to utilize its resources efficiently because of a lack of competitive pressure.

Average Total Costs

The total cost of production divided by the quantity produced, representing the per-unit cost of producing a good or service.

Economies Of Scale

Operational scale increases lead to cost efficiencies for businesses, prominently reflecting in reduced production costs per unit as the amount of output grows.

Diseconomies Of Scale

The situation when a firm’s average total cost of producing a product increases in the long run as the firm increases the size of its plant (and, hence, its output).