Sally and Bob are ready to buy their first house as Sally is expecting their fir

ID: 407451 • Letter: S

Question

Sally and Bob are ready to buy their first house as Sally is expecting their first child in 4 months. Each of their parents will want to visit their new grandchild, so a guest room is important. They also want a large backyard for their two dogs to run and to entertain their friends. They do have a budget that they need to stay within. They have discussed their priorities for the house and decided their 4 fundamental objectives are: minimize purchase price, maximize bedrooms, maximize bathrooms and maximize the backyard. Maximize bedrooms is twice as important as each of the other objectives. Here are the Attribute Scales that they built:

Objective

Minimize Purchase Price

Maximize Bedrooms

Maximize Bathrooms

Maximize Backyard

Ideal-5

Less than $250,000

5 bedrooms

3 bathrooms

Large backyard

Better-4

$250,000-299,999

4 bedrooms

2.5 bathrooms

Big backyard

Fine-3

$300,000-349,999

3 bedrooms

2 bathrooms

Medium backyard

Livable-2

$350,000-450,000

2 bedrooms

1.5 bathrooms

Small backyard

Not good-1

Greater than $450,000

1 bedroom

1 bathroom

No backyard

However, they will use the actual purchase price, # of bedrooms and # of bathrooms for their analysis. They will use the scale for the backyard objective.

They have narrowed their choices to three houses:

RowHome: $250,000, 2 bedrooms, 1.5 baths, small backyard (i.e. Livable)

LargeYard House: $330,000, 3 bedrooms, 2.5 baths, large backyard (i.e. Ideal)

Large House: $450,000, 4 bedrooms, 2.5 baths, medium backyard (i.e. Fine)

The decision problem is: which house is the best house for them?

Step 1: Build a Consequence Table with Original Values

Step 2: Build a Scoring Model with Proportional Scores

Step 3: Build a Weighted Scoring Model and State Your Recommendation