Chapter 9, Problem 18P

a)

Summary Introduction

To develop: An overall ranking of the three companies.

Explanation of Solution

Pairwise comparisons:

Formulas:

Answer:

Normalized matrix:

Formulas:

Answer:

Ranking:

Formulas:

Answer:

b)

Summary Introduction

To check: The pairwise comparisons for consistency.

Explanation of Solution

Consistency:

Formulas:

Answer:

For profitability. 0.07 < 0.10, therefore the preference comparison is consistent.

For growth, 0.003 < 0.10, therefore the preference comparison is consistent.

In the given scenario, there are two preferences for the criteria matrix and they are the exact reciprocals. Therefore, the preference comparison is perfectly consistent.