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Med-Tech labs is a facility that provides medical tests and evaluations for patients, ranging from analyzing blood samples to performing magnetic resonance imaging (MRI). Average cost to patients is $60 per patient. Labor costs average $15 per patient, materials costs are $20 per patient, and overhead costs are averaged at $20 per patient.
(a) What is the multifactor productivity ratio for Med-Tech? What does your finding mean?
(b) If the average lab worker spends three hours for each patient, what is the labor productivity ratio?
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