If Autumn Acres had raised its prices, there wouldn’t have experienced any difference in the rates of their occupancy. Autumn Acres occupancy rates would have still been lower based on factors such as the level of incomes and preference of the general population. The income levels of the population around Autumn Acres is likely to have decreased based on the economic factors (Lee, 2014). The economy is likely to have decreased in a way that lowered the income of many people thus making the cost of visiting a nursing home less affordable and this may have caused the decrease in the occupancy rates.
Demographic information such as the age of the population, the income of the general population and the people’s buying preferences could affect the demand of the healthcare center’s services. The demographic information is needed because the traits will be used in determining the buyer buying behaviors as well as the product preferences of most consumers. These traits are also important because they will help the center identify most of their consumers.
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The demand for healthcare products is usually inelastic because of the availability of substitute products in the market thus consumers feel free to get other products when there is a pricing change. Consumers are always willing to pay for a more superior and better product that is available in the market (Cleverley, 2017). The demand for a firm’s healthcare product is usually elastic because consumers at some point stop buying the product and switch to another firm’s product that is on the market thus making the demand more elastic. If the volume of services change rose by 10 % it would be described as a normal good and thus the income would be elastic.
Assuming the price does not change on the demand for over the counter drugs, the following forecast will happen:
The local population increases and a wet spring that will lead to a bumper crop of ragweed will go up.
A factory closing that will lead to a drop in the area’s average income, a competing product with a different formula that is found to be unsafe, the price of another sinus product and a research study that is published showing that the medication causes severe dizziness will go down.
References
Cleverley, 0. (2017). Essentials of Health Care Finance . Massachusetts: ones & Bartlett Learning.
Lee, R. (2014). Economics for Healthcare Managers . Chicago, IL: Health Administration Press.
