Chapter 9 Healthcare Finance
Questions and answers already
passed 2025/2026
a. What is an opportunity cost rate? - correct answer ✔This is a cost that is associated with alternative
uses for the same funds. If it is used for one investment it cannot be used for other purposes. Hence
"opportunity"
b. How is this rate used in time value analysis? - correct answer ✔It is used to set the discount rate for
the time value analysis of an investment opportunity. Also it is the rate that could be earned on
alternative investments of similar risk
c. Is this rate a single number that is used in all situations? - correct answer ✔No, the rate is specific to
certain situations that involve the opportunity costs at different costs.
9.2 What is the difference between a lump sum? - correct answer ✔A lump sum is an amount that is
made in one installment at a particular time instead of smaller payments over time.
What is the difference in an annuity? - correct answer ✔Annuities are a series of equal payments at
fixed intervals for a specific amount, of periods in time. They can begin at the beginning or end of each
period.
What is the difference in an unequal cash flow stream? - correct answer ✔Unequal cash flows are
where there is more than one lump sum that do not meet the standard for an annuity.
9.3 Great Lakes Health Network's net income increased from $3.2 million in 2001 to $64 million in 2011.
The total growth rate is only about 7.2 percent, which is much less than 100 percent divided by ten
years. - correct answer ✔Check out the next 2 slides
Questions and answers already
passed 2025/2026
a. What is an opportunity cost rate? - correct answer ✔This is a cost that is associated with alternative
uses for the same funds. If it is used for one investment it cannot be used for other purposes. Hence
"opportunity"
b. How is this rate used in time value analysis? - correct answer ✔It is used to set the discount rate for
the time value analysis of an investment opportunity. Also it is the rate that could be earned on
alternative investments of similar risk
c. Is this rate a single number that is used in all situations? - correct answer ✔No, the rate is specific to
certain situations that involve the opportunity costs at different costs.
9.2 What is the difference between a lump sum? - correct answer ✔A lump sum is an amount that is
made in one installment at a particular time instead of smaller payments over time.
What is the difference in an annuity? - correct answer ✔Annuities are a series of equal payments at
fixed intervals for a specific amount, of periods in time. They can begin at the beginning or end of each
period.
What is the difference in an unequal cash flow stream? - correct answer ✔Unequal cash flows are
where there is more than one lump sum that do not meet the standard for an annuity.
9.3 Great Lakes Health Network's net income increased from $3.2 million in 2001 to $64 million in 2011.
The total growth rate is only about 7.2 percent, which is much less than 100 percent divided by ten
years. - correct answer ✔Check out the next 2 slides
