According to the Gallup Poll, $27\%$ of U.S. adults have high levels of cholesterol. Gallup reports that such elevated levels "could be financially devastating to the U.S. healthcare system" and are a major concern to health insurance providers. According to recent analyses, cholesterol levels in healthy U.S. adults average about $215 \mathrm{mg} / \mathrm{dL}$ with a standard deviation of about $30 \mathrm{mg} / \mathrm{dL}$ and are roughly Normally distributed. If the cholesterol levels of a sample of 42 healthy U.S. adults are taken,

b) What would the mean of the sampling distribution be?

Every year, Fortune Magazine lists the 100 best companies to work for, based on criteria such as pay, benefits, turnover rate, and diversity. In 2013, the top three were Google, SAS, and CHG Healthcare. Of the top 30, 11 experienced double-digit job growth (10% or more), 16, single-digit growth ( $1 \%$ to $10 \%), 2$ had no growth, and Google did not report. Of the bottom 30, only 5 experienced double-digit job growth, 16 had single-digit growth, and 9 had no growth or job loss. Disregarding Google, is job growth in the best of the best places to work differently from job growth at the bottom of that elite list?

c) State the hypotheses.

The following information on Siemens AG's treatment of research and development is extracted from its 2018 financial statements. Siemens AG is an integrated technology company with activities in the fields of industry, energy and healthcare. The company is incorporated under the laws of Germany and reports using lnternational Financial Reporting Standards (IFRS).

Research and development costs-Costs of research activities are expensed as incurred. Costs of development activities are capitalized when the recognition criteria in IAS 38 are met. Capitalized development costs are stated at cost less accumulated amortization and impairment losses with an amortization period of generally three to ten years.

a. How does the reporting under rFRS differ from reporting under U.S. GAAP for research and development?

Let's say the president of the United States wishes to estimate the percentage of the population that agrees with his present stance on changes to the healthcare system. The estimate must be within.04 of the actual proportion, according to the president. Count on a 95% level of certainty. The political advisers to the president located a comparable poll from two years prior that showed 60% of respondents were in favour of making changes to the health care system. Using this, find how large of a sample is required?

"Consider how health insurance affects the quantity of healthcare services performed. Suppose that the typical medical procedure has a cost of $100, yet a person with health insurance pays only$20 out of pocket. Her insurance company pays the remaining $80. (The insurance company recoups the$80 through premiums, but the premium a person pays does not depend on how many procedures that person chooses to undertake.)

Draw the demand curve in the market for medical care. (In your diagram, the horizontal axis should represent the number of medical procedures.) Show the quantity of procedures demanded if each procedure has a price of $100."

Let's say the president of the United States wishes to estimate the percentage of the population that agrees with his present stance on changes to the healthcare system. The estimate must be within.04 of the actual proportion, according to the president. Count on a 95% level of certainty. The political advisers to the president located a comparable poll from two years prior that showed 60% of respondents were in favour of making changes to the health care system. Using this, find how large of a sample would be necessary if no estimate were available for the proportion supporting current policy?

Merck & Co., Inc. and Johnson & Johnson are two leading producers of healthcare products. Each has considerable assets, and each expends considerable funds each year toward the development of new products. The development of a new healthcare product is often very expensive, and risky. New products frequently must undergo considerable testing before approval for distribution to the public. For example, it took Johnson & Johnson 4 years and $200 million to develop its 1-DAY ACUVUE contact lenses. Below are some basic data compiled from the financial statements of these two companies.

$$\begin{array}{lcc} \text{{(all dollars in millions)}}&\text{\underline{Johnson \& Johnson}}&\text{\underline{Merck}}\\ \text{Total assets}&\text{\$\hspace{5pt}53,317}&\text{\$\hspace{5pt}42,573}\\ \text{Total revenue}&\text{\hspace{10pt}47,348}&\text{\hspace{10pt}22,939}\\ \text{Net income}&\text{\hspace{14pt}8,509}&\text{\hspace{14pt}5,813}\\ \text{Research and development expense}&\text{\hspace{14pt}5,203}&\text{\hspace{14pt}4,010}\\ \text{Intangible assets}&\text{\hspace{9pt}11,842}&\text{\hspace{14pt}2,765}\\ \end{array}$$

Instructions

• a. What kinds of intangible assets might a healthcare products company have? Does the composition of these intangibles matter to investors—that is, would it be perceived differently if all of Merck’s intangibles were goodwill than if all of its intangibles were patents?
• b. Suppose the president of Merck has come to you for advice. He has noted that by eliminating research and development expenditures the company could have reported $4 billion more in net income. He is frustrated because much of the research never results in a product, or the products take years to develop. He says shareholders are eager for higher returns, so he is considering eliminating research and development expenditures for at least a couple of years. What would you advise?
• c. The notes to Merck’s financial statements note that Merck has goodwill of$1.1 billion. Where does recorded goodwill come from? Is it necessarily a good thing to have a lot of goodwill on a company’s books?

Suppose that a healthcare provider selects 20 patients randomly (without replacement) from among 500 to evaluate adherence to a medication schedule. Suppose that 10% of the 500 patients fail to adhere with the schedule. Determine the following: a. Probability that exactly 10% of the patients in the sample fail to adhere. b. Probability that fewer than 10% of the patients in the sample fail to adhere. c. Probability that more than 10% of the patients in the sample fail to adhere. d. Mean and variance of the number of patients in the sample who fail to adhere.

Workers in several industries were surveyed to determine the proportion of workers who feel their industry is understaffed. In the government sector, 37% of the respondents said they were understaffed, in the healthcare sector 33% said they were understaffed, and in the education sector, 28% said they were understaffed (USA Today, January 11, 2010). Suppose that 200 workers were surveyed in each industry. a. Construct a 95% confidence interval for the proportion of workers in each of these industries who feel their industry is understaffed.

Healthcare professionals cite an enormous number of health problems related to obesity, and many people have an understandable desire to attain a healthy weight. There are many diet programs, services, and products on the market to aid those who wish to lose weight. If a close friend was considering purchasing or participating in one of these products, programs, or services, how would you make sure your friend was fully aware of the potential consequences of this decision? What sort of information would you want to review before making such an investment or lifestyle change yourself?

Imagine that your job as a healthcare professional is to take a blood sample from a patient and store it in a small container in a refrigerator until it is picked up for analysis in the hospital lab. You might have to put on gloves and a mask, use a plastic syringe with a metal needle, store the sample in a test tube or vial, and place it in a cold refrigerator. Pick five objects you might encounter during the process and decide if they are made of naturally occurring or synthetic materials.

Goodson Healthcare purchased a new sonogram imaging unit for $300,000 and a truck body and chassis for an additional$100,000 to make the unit mobile. The unit-truck system will be depreciated as one asset. The functional life is 8 years, and the salvage is estimated to be 10% of the purchase price of the imaging unit regardless of the number of years of service. Use classical straight line depreciation to determine the salvage value, annual depreciation, and book value after 4 years of service.

Hospital length of stay. Health insurers and the federal government are both putting pressure on hospitals to shorten the average length of stay (LOS) of their patients. The average LOS in the United States is $4.5$ days (Healthcare Cost and Utilization Project Statistical Brief, October 2014). A random sample of 20 hospitals in one state had a mean LOS of $3.8$ days and a standard deviation of $1.2$ days. What is meant by the phrase "90% confidence interval"?

MGM Resorts International owns and operates hotels and casinos including the MGM Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, MGM reported accounts receivable of $415,654,000 and allowance for doubtful accounts of$93,760,000. Johnson & Johnson manufactures and sells a wide range of healthcare products including Band-Aids and Tylenol. As of a recent year, Johnson & Johnson reported accounts receivable of $10,114,000,000 and allowance for doubtful accounts of$340,000,000.