Standards of health care, Do you expect this marginal cost

Standards of health care

Reference no: EM131007047

Currently the hospital caters for about 100,000 residents, with an annual budget of $50 million. The region is experiencing rapid population growth, and you expect to have to look after 110,000 residents next year. You have just been told that your budget then will be $52.5 million (in inflation-adjusted terms). Since you used to have $500 to work with per resident, but now will have to work with $477.27 per resident, can you say with justification that the government is deliberately allowing the standards of health care to fall in the region?( "marginal cost" of looking after each of the 10,000 new residents. Do you expect this marginal cost to be lower, or higher, than the average cost of looking after each of the current 100,000 current resident? Why? How low must the marginal cost be for you to be confident that the standards of health care can be maintained?)

Reference no: EM131007047

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