Assume that you are the manager of a regional hospital. You and your management team have forecasted a 10% increase in demand for emergency room services each year for the next three years—and you have staffed and prepared capital equipment based on this forecast. In year one, your demand increase is only 5%. What impact, if any, does this have on the cost of services? Describe the impact, explain your rationale, and finally, describe what actions you would take to address the shortfall in the forecast.
