Info

Total 41 .99

Prior to consideration of performance standards and sources of information for the criteria we have chosen, we must ask, "Are there any characteristics that must be present (or absent) in a candidate automobile for it to be acceptable?" Assume, for this example, that to be acceptable, an alternative must not be green, must have air conditioning, must be able to carry at least four adults, must have at least 10 cubic feet of luggage space, and must be priced less than $33,000. If an alternative violates any of these conditions, it is immediately rejected.

For each criterion, we need some way of measuring the estimated performance of each alternative. In this case, we might adopt the measures shown in Table B. Our purpose is to transform a measure of the degree to which an alternative meets a criterion into a score, the Sj,-, that is a general measure of the utility or value of the alternative with respect to that criterion. Note that this requires us to define the criterion precisely as well, as to specify a source for the information.

Figure A shows the scores for each criterion transformed to a 5-point scale, which will suffice for our ratings.

Using the performance scores shown in Figure A, we can evaluate the cars we have identified as our alternatives: the Leviathan 8, the NuevoEcon, the Maxivan, the Sporticar 100, and the Ritzy 300. Each car is scored on each criterion according to the categories shown in Figure A. Then each score is multiplied by the criterion weight and the result is entered into the appropriate box in Figure B. Last, the results for each alternative are summed to represent the weighted score.

According to this set of measures, we prefer the Ritzy 300, but while it is a clear winner over the Leviathan 8 and the Maxivan. and scores about 8 percent better than the Sporticar, it rates only about 0.13 points or 4 percent above the NuevoEcon. Note that if we overrated the Ritzy by one point on Comfort or Handling, or if we underrated the NuevoEcon by one point on either of these criteria, the result would have been reversed. (We assume that the original cost data are accurate.) With the scores this close, we might want to evaluate these two cars by additional criteria (e.g., ease of carrying children, status,

Tcible B Automobile Selection Criteria, Measures and Data Sources

Appearance

Subjective judgment, personal

Braking

Distance in feet, 60-0 mph, automotive magazine"

Comfort

Subjective judgment, 30 min. road test

Cost, operating

Annual insurance cost plus fuel cost'

Cost, original

Dealer cost, auto-cost service'

Handling

Average speed through standard slalom, automotive magazine"

Reliability

Score on Consumer Reports. "Frequency-of-Repair" data (average of 2 previous years)

"Many automotive periodicals conduct standardized performance tests of new cars. 'Annual fuel cost is calculated as (17,500 mi/DOE ave. mpg) X $l.25/gal.

'There are several sources for dealer-cost data (e.g., AAA, which provides a stable data base on which to estimate the price of each alternative).

"Many automotive periodicals conduct standardized performance tests of new cars. 'Annual fuel cost is calculated as (17,500 mi/DOE ave. mpg) X $l.25/gal.

'There are several sources for dealer-cost data (e.g., AAA, which provides a stable data base on which to estimate the price of each alternative).

Scores

Criteria

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