Production Theory


This assignment is intended to help you learn to do the following:

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Develop the production function and determine how the efficient use of factor inputs can be determined by marginal product and marginal factor cost analysis.
Explain the demand for factor inputs within the production function such as labor and capital that will optimize the efficient use of resources.
Review different rules of differential calculus that can be used to solve problems and determine optimum production resource utilization conditions.


It is estimated that by 2030 there will be a physician shortage of approximately 120,000 physicians in the US. Lack of residency opportunities is one factor that has contributed to slow growth in the supply of physicians.  Two contributing factors of demand in healthcare are a rise in the U.S. population and the aging population base.  The U.S. population is expected to grow to 360 million people in 2030 and the age of people over 65 years is estimated to comprise 50 percent of the new growth. Not only will the patient demographics be skewed towards the geriatric population, but medical services will need to be geared towards this aging population. To take things a step further, the physicians who currently make up a vast majority of the physician workforce today will be retiring by 2030.  These conditions will contribute to widening the gap between patients and their access to physicians that provide healthcare services.

There have been several suggestions or corrective actions being offered in an attempt navigate away from the impending crisis. Some have called for allowing allied health professionals such as physician assistants and nurse practitioners to take on more patient responsibility within medical practices. Other medical support services, such as nutritionists/dietitians, medical social workers, and pharmacists might also be interwoven to a healthcare team that would help to maintain proper levels of medical service. There may also be other important components that are impacting patient demand and service supply availability.
Action Items

Compose a two- to three-page paper in which you:
Consider the Overview information provided above.
Develop a healthcare production model that would attempt to meet the rise in healthcare demand with the current level of physicians and that would properly service the healthcare system in 2030.
Include alternative medical staff with different skill levels that could provide healthcare services.
Include the different cost levels of labor among the different technical skill sets.
Cite a minimum of three scholarly resources.
Format your paper according to the standards found on Purdue Online Writing Lab: APA Formatting and Style Guide. Submit your work by the due date indicated. For more information on Production Theory see this:

Production Theory

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