Question
To analyze the best location of a new library in Eugene, Oregon, the overall utility of each of four proposed locations was calculated using a
To analyze the best location of a new library in Eugene, Oregon, the overall utility of each of four proposed locations was calculated using a multi-attribute utility model. One important feature of this study was that cost were not included in this model because the analysts who conducted the study thought it would be better to leave the final "big" tradeoff between the overall utility and total cost to the decision maker. The graph below summarizes the overall utilities and cost for each of the four proposed locations.
If the decision maker would be willing to spend $1,000,000 for each additional "utility point", which alternative should (s)he choose? What if (s)he is only willing to spend $100,000 for a one-unit increase in overall utility? HINT: no calculations are required. You can actually figure out the answers by drawing lines in the above graph
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