Decision risk analysis ()-1.016-0.016i and v)1.079-0.079 2 respectively. By assu

Question

Decision risk analysis ()-1.016-0.016i and v)1.079-0.079 2 respectively. By assuming mutual preferential and utility independence, the multi- v,(r.) + o.763%(t2) artritute utility-function ,(r,. t) can be shown as 0.971 0.734 v,(t) Figure 6 Utility surface for fire station Theory Consider the two-dimensional case. It is obvious that the outcomes (ymyminy and function. (Notice that yny on occasions.) In accordance with normal practice, ) are the least and most desirable ones for the two-attribute utility we set v(,0 and v(I. Then from the multiplicative- value-fanction expression D, the utility function with y set at the least desirable state and at the most desirable state is given by or Figure 7-Utility comparison between truck dispatches EXERCISE: Show that by symmetry, w,= v ( y", y,"").

Explanation / Answer

From the equation:

1 + kv(y1max,y2min) = [1 + kw1v1(y1mac)][1+ kw2v2(y2min)] = 1 + kw1 (because v1(y1max) = 1, v2(y2min) =0

thus, w1 = v(y1max, v2min)

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