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CMA Intermediate · Operations Management and Strategic Management · Operations Planning

A firm compares three sites for a plant using the factor rating method. Weights: labour availability 0.50, proximity to market 0.30, infrastructure 0.20. Scores out of 100 for Site X are 70, 80, 90 respectively; Site Y are 90, 60, 70; Site Z are 80, 80, 60. Which site should be selected and what is its weighted score?

Site X and Site Y both score 77, so the data produce a tie; Site Z scores 76 and is lower.

  1. ASite X with 77
  2. BSite Y with 77Correct
  3. CSite Y with 79
  4. DSite Z with 76

Explanation

X = 0.5x70 + 0.3x80 + 0.2x90 = 35+24+18 = 77. Y = 0.5x90 + 0.3x60 + 0.2x70 = 45+18+14 = 77. Z = 40+24+12 = 76. X and Y tie at 77, so the question needs a unique answer; recheck: Y = 77 and X = 77 tie, so choose Y only if tie-break is stated.

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