Problem
According to the California Nurses Association, Tenet Healthcare hospitals mark up drugs substantially. At Tenet's Sierra Vista Regional Medical Center, drug prices are 1,840.80% of the hospital's costs (Chuck Squatriglia and Tyche Hendricks, "Tenet Hiked Drug Prices, Study Finds More Than Double U.S. Average," San Francisco Chronicle, November 24, 2002: A1, A10). Assuming Tenet is maximizing its profit, what is the elasticity of demand that Tenet believes it faces? What is its Lerner Index for drugs?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.