Case Study, Macro & Micro economics
1. Please save your memo with your “last name.doc”. For example, if your name is Clark Kent, save your memo as Kent.doc. If you include a Word exhibit, save it with the name of Kent2.doc. If you include an Excel exhibit, just name it Kent.xls. Submit your assignment anytime PRIOR TO MIDNIGHT ON THE DUE DATE INDICATED ON THE COURSE WEBSITE FOR UNIT 7.

2. The memo must be a professional, one page memo. I have provided a template for you to use (see below). Please be certain to address each area indicated in the template. There is an optional (but highly recommended) one page exhibit. This would be the place to show what you could do with the case data without having to use memo space. I have given you the exhibit data on a spreadsheet in case you want to use any of it for your analysis. If you do create an exhibit, be certain to reference it somewhere in the memo so that the reader knows to which text it is linked. Further, the exhibit should not be a substitute for memo text!

3. Below are some questions to guide your preparation. You will not be able to address all of them in the memo. Please use them as they are intended…as a guideline to thinking about many of the case issues. I have also posted some study questions that are very similar to these below. You may use them too. Remember, in a one-page memo you will not be able to address all of these!
? Be prepared to explain Exhibits 1 and 2 in the case as a basis for your analysis. What is the link between these two exhibits?
? What should administrators and clinicians consider when deciding whether to close a service?
? Can you quantify the aspects of this decision from the perspective of both Drs. Lawrence and Newell? How do those perspectives differ?
? Are there other factors that must be considered? If so, what are they?
? What assumptions are necessary to calculate a breakeven volume for the dialysis unit? Of what use is this type of analysis? (You need not necessarily calculate this number.)
? What will happen to total costs and revenues if the renal dialysis unit is closed? (This is probably the key quantitative question.)
? What are the options that both Drs. Newell and Lawrence should consider?
? Is the dialysis unit self-sustaining? Please explain briefly.
? Other than closing the unit, what other options are available for the hospital and what are their financial consequences?
? Should the unit be closed?