at Saving Grace Hospital with those at ACME Hospital. Further suppose that the two
hospitals annually admit about 24,000 and 32,000 patients, respectively, at average
short-run total costs per admission of roughly $11,000 and $12,000.
A. Why may these two dollar figures not represent the economic cost of providing
inpatient services at these two hospitals? Explain fully.
Suppose you are to specify a short-run production function for dental services. What inputs might you include in the production function? Which would be the variable inputs and which the fixed inputs?
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