Assume That a Decision Maker Has to Make a Choice $\left[ \begin{array} { l } .3 \\.5 \\.2\end{array} \right]$

question 18

Short Answer

Assume that a decision maker has to make a choice between three types of cars. Chevy, Honda, and Ford. Based on three criteria: comfort, MPG, and style.
The row averages for criteria is summarized in the following column vector: $\left[ \begin{array} { l } .3 \\.5 \\.2\end{array} \right]$
The preference matrix for the three types of cars is given as follows: $\left[ \begin{array} { l l l } .5 & .2 & .2 \\.3 & .7 & .2 \\.2 & .1 & .6\end{array} \right]$
Compute the overall score for each decision alternative (car).

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Definitions:

Uncertainty

A state of having limited knowledge where it is impossible to exactly describe the existing state, a future outcome, or more than one possible outcome.

Risk

The exposure to the chance of loss or damage, or the uncertainty regarding the outcome of an action or decision.

Certainty

The firm conviction that something is reliably true, without any doubt, often used in decision-making processes.

Information-Processing Style

An individual's preferred method of gathering, interpreting, and organizing information.