Healthcare Financial Management and Economics Weok 10 Assignment-Capital Budgeti

Question

Healthcare Financial Management and Economics Weok 10 Assignment-Capital Budgeting There are many options to buy capital, including cash purchases, loans, leasing, and other forms of payment. Your goal as a healthcare manager is to determine which method is best for your organization, given its financial and organizational structure (ie. for-profit or not-for-profit). Time value of money and net present value are two techniques that may help you determine how and when to invest in new capital. For this Assignment, you examine these concepts as they pertain to the healthcare industry To prepare for this Assignment: Review this week's Learning Resources. Reflect on concepts of time value of money net present value, internal rate of return, and purchasing options The Assignment Using an Excel spreadsheet to show your work, answer the following questions 1. If a physician deposits $24,000 today into a mutual fund that is expected to grow at an annual rate of 8%, what will be the value of this investment a. 3 years from now b. 6 years from now c. 9 years from novw d. 12 years from now The Chief Financial Officer of a hospital needs to determine the present value of $120,000 investment received at the end of year 5. What is the present value the discount rate is: 2. a 3% b.6% C.9% d. 12% Calexico Hospital plans to invest $1.8 milion in a new MRI machine. The MRI will be depreciated over its 5-year economic life to a $200,000 salvage value. Additional revenues attributed to the new MRI will be in the amount of $1.5 million per year for 5 years Additional operating expenses, excluding depreciation expense, will amount to $1 million per year for 5 years. Over the life of the machine, net working capital will increase by $30,000 per year for 5 years 3. Page 1 of 2 o 2015 Laureate Education, Inc

Explanation / Answer

Future Value P(1+i)^n P $ 24,000 i 8% n 3 6 9 12 30233.088 38084.98375 47976.11105 60436.0828 $B$2*(1+$B$3)^B4 $B$2*(1+$B$3)^C4 $B$2*(1+$B$3)^D4 $B$2*(1+$B$3)^E4 Present Value A/(1+i)^n A 120000 n 5 i 3% 6% 9% 12% 103513.0541 89670.98074 77991.76636 68091.22269

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.