HCA 530 Topic 7 DQ 2 In the healthcare, the position of the long-run average cost curve is determined by a set o

HCA 530 Topic 7 DQ 2

In the healthcare, the position of the long-run average cost curve is determined by a set of circumstances that includes the price of all inputs, quality, and patient case mix. Provide an example of a change that will cause the long-run average cost curve to shift down. Justify the validity of the example.

In your response to peers, discuss whether you agree or disagree with the examples provided by your peers.

Answer:

In the healthcare, the position of the long-run average cost curve is determined by a set of circumstances that includes the price of all inputs, quality, and patient case mix. An example that will cause the long-run average cost curve to shift down is when there is a change in input price of a substitute good. If the price of a substitute good falls, that will result into an increase in its demand. This means that there will be increased production from this substitute and therefore an increase in supply of goods. A fall in price will cause an increase in demand for these goods, resulting into an increase in their supply (Royer & Griffiths, 2014).

The example is valid since it shows how an increase in supply can lead to a decrease in prices. The same case applies when there is a change in input prices as explained above. In this case, if the prices of input are lowered, it means that it will be easier for firms to produce more goods at lower cost. This results into an increase in supply and a decrease in prices.

The long-run average cost curve (LAC) is determined by a set of circumstances that includes the price of all inputs, quality, and patient case mix. An example of a change that will cause the LAC to shift down is if the price of all inputs falls. For example, if there is an increase in the supply of labor, causing wages for health care workers to decrease, this would cause the LAC to shift down.

This example is valid because an increase in production requires more labor. If the price of labor decreases, this will contribute to a lower average cost in production.

The long-run average cost curve is determined by a set of circumstances that includes the price of all inputs, quality, and patient case mix. This means that any change in the price of inputs, quality, or patient case mix will cause the long-run average cost curve to shift down.

For example, let’s say an organization has been using a particular brand of paper towel for years. When they buy paper towels from this company, they pay $1 per roll. However, one day they are approached by another company that wants their business. The second company offers the organization a price of $0.75 per roll if they buy 100 rolls a month. In this situation, the price of inputs has changed and therefore the change in price will cause the long-run average cost curve to shift down.

In the healthcare industry, the position of the long-run average cost curve is determined by many factors, including the price of all inputs, quality and patient case mix. However, one factor that often gets overlooked is technology. I’d argue that an increase in technology would cause an organization’s long-run average cost curve to shift down.

 

For example, let’s say a medical center decides to purchase a new piece of equipment that allows it to perform surgeries with less risk and at less cost than ever before. The new piece of equipment would allow the company to perform more surgeries in a shorter amount of time, thereby reducing overhead costs and increasing profits for the company.

 

When a medical center shifts from paper records to electronic health records, this also reduces overhead costs and increases profits because it lowers costs related to waste disposal and paper management. Moreover, electronic health records are far easier to access than paper records. This means doctors can spend less time looking for critical information about their patients and more time actually treating them.

In the healthcare field, the long-run average cost curve determines a lot of things, including the price of all inputs and the quality and patient case mix. When the long-run average cost curve shifts down, you can expect a few things to happen.

For example, let’s say a new technology is developed that allows nurses to take care of more patients with fewer resources than they needed before. This would cause the long-run average cost curve to shift down, because now there would be fewer costs associated with taking care of each individual patient.

As another example, let’s say an innovative new software program is developed that cuts down on human error for nurses and doctors (which can happen more often than we’d like to think). This would also mean that fewer mistakes would be made when it came to patient care—and this would also result in a shift in the long-run average cost curve.

There are a number of changes that can cause the long-run average cost curve to shift down. For example, if the price of a certain input decreases, the cost curve will shift down. This is because the decrease in input price means that the company will now be able to purchase more inputs at the same price as before. Essentially, this creates an opportunity for increased supply and decreased costs, which may lead to lower prices and greater profits.

In addition, if there is a change in technology that allows for increased efficiency in production of goods/services, this will also lead to a shift down in the long-run average cost curve. This is again due to the fact that there is now an opportunity for greater output with decreased input costs.

The long-run average cost curve is determined by many factors, including the quality of the service and patient demographics. For example, if a hospital began using a new type of medicine that allowed them to treat more severe cases, they would be able to charge more for those treatments and increase their profits. Or if they had an influx of patients with chronic diseases who needed constant care, their costs would go up because they’d need more staff members on duty around the clock.

A change that could cause this curve to shift down would be if there were fewer patients overall coming into hospitals (or fewer complex cases), so medical facilities weren’t able to charge as much for services. Hospitals rely heavily on revenue from treating patients in order to pay their overhead expenses like rent, utilities, and salaries, so any reduction in patients would affect their bottom line negatively.

Question:

HCA 530 Topic 7 DQ 2

In the healthcare, the position of the long-run average cost curve is determined by a set of circumstances that includes the price of all inputs, quality, and patient case mix. Provide an example of a change that will cause the long-run average cost curve to shift down. Justify the validity of the example.

In your response to peers, discuss whether you agree or disagree with the examples provided by your peers.

Scroll to Top