Question

Provide a description of the production function for an acute care hospital in the United States. What are 2-3 of the hospital’s outputs? What inputs does it use to produce these outputs? Are there any special features of the way production takes place in the hospital?

Answer 1

For an acute care hospital the production function can be formulated as

Y=F(X1, X2, X3)

Where inputs are

X1= Bed to Patient ratio

X2= Physical availability of physicians

X3= Average cost of treatment

Output Y= Productivity.

The output at acute care hospital can be productivity, Brand recognition, success ratio.

Special features of production including usage of latest technology, doctor availability 24×7, low cost medicliam processing, etc.