Lecture 4 (End of Chapter Questions)

Question 1

How can you check for the sensitivity of the decision to attribute weights?

Answer 1

Sensitivity Analysis:

1. Express each weight in terms of the weight that you would like to alter
2. Rewrite the value of each alternative as a function of the attribute weight that you would like to alter
3. Vary the objective weight in order to see how sensitive the decision is

Question 2

Can you still make decisions if your information about weights is incomplete?

Answer 2

Apply a dominance test.

Question 3

How do you conduct a test for dominance?

Answer 3

1. Pick an arbitrary set of weights that satisfy the incomplete information
2. Calculate the values of the alternatives with respect to these arbitrary weights
3. Eliminate one of the possible dominance relationships
4. Check for the opposite direction by investigating the sign of max[V(a) - V(b)]