Describing step of analytical hierarchy process

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Reference no: EM1323321

Q1) Firm's financial manager evaluates that new project proposal will develop revenue by $14,000 per year for 7 years, and will also decrease costs by $5,000 per year. Present value of these flows are about $68,158 and $24,342 assuming a 10% discount rate. Project costs $90,000. Project's ROI is about:

a) 0.49

b) 0.11

c) 1.03

d) 1.79

Q2) First step of analytical hierarchy process doesn't include

a) Defining the overall objective of the decision process.

b) Determining the criteria on which to base the decision.

c) Ranking the decision alternatives.

d) Modelling the decision problem.

Q3) Two criteria and two alternatives are being considered. Criterion 1 is twice as significant as Criterion 2. Following comparison matrices have been determined:

Criterion 1

A

B

A

1.00

0.20

B

5.00

1.00

 

Criterion 2

A

B

A

1.00

0.14

B

7.00

1.00

Which of given statements regarding this decision problem is not true?

a) Alternative B is always favoured to Alternative A.

b) These are not normalized comparison matrices.

c) The relative priority of Alternative A on the basis of Criterion 1 is 0.17.

d) Alternative A is sometimes preferred to Alternative B.

Reference no: EM1323321

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