Hospital is a
Grade 3A institution, which is the highest national classification
of hospital in Mexico
City, Mexico. Holy Cross
Hospital is well
reputed for geriatric treatment and provides
for central government and church
als. The hospital employs 2,515
staff, provides 12,100 beds, and its eq
uipment cost over 1 billion pesos
Suppose that Holy Cross
Hospital has spare capacity in professional staff,
beds, and equipment, and that it uses the spare capacity to tre
patients. What principle of cost does this illustrate?
Do you expect the demand
for medical services in Mexico City
to be more
or less elastic among for
eigners as compared with Mexican
Explain how Holy Cross
Hospital could apply
discrimination between Mexican
and foreign patients.
How could Holy Cross
Hospital use the cho
ice between treatment by
speaking medical staff to effect
and foreign patients?
What condition is
necessary for this segmentation to succeed?