1. Physicians\' offices supply some urgent care services (i.e., services patient

ID: 1090978 • Letter: 1

Question

1. Physicians' offices supply some urgent care services (i.e., services patients seek for prompt attention but not for preservation of life or limb).

a. Name three other providers of urgent care services.

b. What sort of shift in supply or demand would result in a market equilibrium with higher prices and sales volumes?

c. What might cause such a shift?

d. What sort of shift in supply or demand would result in a market equilibrium with higher prices but lower sales volume?

e. What might cause such a shift?

2. A laboratory has $4,2 million in revenues and $3.85 million in costs. What is its operating margin?

3. The owners of the laboratory invested $6 million. What is the return on investment?

a) 3 other providers of urgent care services: Physiotherapists, General physicians, car mechanics to help on-the-road car repairs etc.

b) Increase in the demand, or a rightward shift in the demand curve would result in a market equilibrium with high prices and sales volumes.

c) An increase in demand for such services will lead to such a shift

d) Decrease in supply, or a leftward shift in the supply curve would result in a market equilibrium with high prices but lower sales volumes.

e) A fall in the supply of such serive providers would cause such a shift.

2. Operating margin = Revenue - Cost = $4.2-$3.85 million = $0.35 million

3. Return on investment = Operating margin/Investment = (0.35/6) million = 0.05833

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