In: Operations Management
Northeastern Insurance Company is considering opening an office in the U.S. The two cities under consideration are
Philadelphia and New York.
The factor ratings (higher scores are better) for the two cities are given in the following table.
Factor |
Weight |
PhiladelphiaPhiladelphia |
New YorkNew York |
Customer convenience |
0.25 |
75 |
75 |
Bank accessibility |
0.20 |
40 |
85 |
Computer support |
0.20 |
90 |
70 |
Rental costs |
0.15 |
85 |
50 |
Labor costs |
0.10 |
80 |
50 |
Taxes |
0.10 |
90 |
55 |
Based on the given information, the best location for Northeastern Insurance Company to open the office is
____________
with a total weighted score of
___________.
(Enter your response rounded to two decimal places.)
Total weighted score of Philadelphia = (0.25*75 + 0.2*40 + 0.2*90 + 0.15*85 + 0.1*80 + 0.1*90)
= (18.75 + 8 + 18 + 12.75 + 8 + 9)
= 74.5
Total weighted score of New York = (0.25*75 + 0.2*85 + 0.2*70 + 0.15*50 + 0.1*50 + 0.1*55)
= (18.75 + 17 + 14 + 7.5 + 5 + 5.5)
= 67.75
Based on the given information, the best location for Northeastern Insurance Company to open the office is Philadelphia with a total weighted score of 74.5