Oakdale Community Hospital is considering building an ambulatory surgery center.
ID: 2636967 • Letter: O
Question
Oakdale Community Hospital is considering building an ambulatory surgery center. Which of the following opportunity cost rates would be most appropriate for discounting the project's future cash flows?
The expected rate of return on a bank CD
The expected rate of return on a municipal bond
The expected rate of return on the stock of SurgiCare Corporation, a for-profit company that operates a large number of freestanding ambulatory surgery centers
The expected rate of return on the stock of Skilled Healthcare Group, a for-profit company that operates a large number of nursing homes and assisted living centers
The expected rate of return on Medcath Corporation, a for-profit company that operates a large number of cardiac specialty hospitals
The expected rate of return on a bank CD
The expected rate of return on a municipal bond
The expected rate of return on the stock of SurgiCare Corporation, a for-profit company that operates a large number of freestanding ambulatory surgery centers
The expected rate of return on the stock of Skilled Healthcare Group, a for-profit company that operates a large number of nursing homes and assisted living centers
The expected rate of return on Medcath Corporation, a for-profit company that operates a large number of cardiac specialty hospitals
Explanation / Answer
The expected rate of return on the stock of SurgiCare Corporation, a for-profit company that operates a large number of freestanding ambulatory surgery centers
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