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ACCA Applied Knowledge · Management Accounting · Performance measurement - application

A hospital ward treated 2,400 patients in a month using 12,000 nursing hours. In the previous month it treated 2,250 patients using 11,250 nursing hours. Which statement about efficiency, measured as patients treated per nursing hour, is correct?

Efficiency was unchanged at 0.20 patients per nursing hour in both months. Current month is 2,400 divided by 12,000 and the previous month is 2,250 divided by 11,250. Both outputs and inputs rose in proportion, so the ratio did not change.

  1. AEfficiency fell because total hours worked increased
  2. BEfficiency rose because more patients were treated
  3. CEfficiency was unchanged at 0.20 patients per nursing hour in both monthsCorrect
  4. DEfficiency rose from 0.20 to 0.25 patients per nursing hour

Explanation

Current month: 2,400 / 12,000 = 0.20 patients per hour. Previous month: 2,250 / 11,250 = 0.20. The ratio is identical, so efficiency is unchanged. Higher patient numbers or higher hours alone do not show a change in efficiency because both outputs and inputs rose proportionately.

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