A medical clinic is considering 3 sites for the location of its new clinic. It h

Question

A medical clinic is considering 3 sites for the location of its new clinic. It has collected the following information. The scores for the non-financial data are on a 0-3 scale with three being best. It is possible to score a 3.0 for any of these factors.

A) Using the factor scoring (factor rating) which site do you recommend? Why?

B) Suppose that the clinic wants to add another factor, Profit, to its analysis. This factor would be assigned a weight of 0.20 by reducing the road access factor weight to 0.05. The values of the profit for each site are as follows:

Site A: $6.0 million       Site B: $4.0 million      Site C: 3.0 million

Using the factor scoring method with this additional information, which site is now recommended? Why?

Factor Factor Weight Site A Site B Site C Building Cost 0.35 $3.5 million $4.0 million $5 million Road Access 0.25 1.5 3.0 2.4 Bus Access 0.15 3.0 1.8 1.2 Safety 0.20 1.2 2.4 3.0 Site Size 0.05 2.4 1.2 2.4

Explanation / Answer

Answer:A)

Site C is recommended because its profit is high as compared to other site.

Answer:B)

Site C is recommended because its profit is high as compared to other sites.

Factor Factor Weight Site A Site B Site C Amount ($ in million) site A Amount ($ in million) site B Amount ($ in million) site C Building Cost 0.35 3.5 4 5 1.225 1.4 1.75 Road Access 0.25 1.5 3 2.4 0.375 0.75 0.6 Bus Access 0.15 3 1.8 1.2 0.45 0.27 0.18 Safety 0.2 1.2 2.4 3 0.24 0.48 0.6 Site Size 0.05 2.4 1.2 2.4 0.12 0.06 0.12 Total 2.41 2.96 3.25

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