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Trade-Off Analysis

The trade-off analysis method makes use of direct assessments of trade-offs that the decision maker is willing to make between pairs of alternatives. The trade-offs define a unique set of weights that will allow all of the equally preferred alternatives in the trade-offs to get the same overall value/utility. The approach requires the decision maker to compare two alternatives (say A and B) with respect to two criteria at a time and assess which alternative is preferred. Specifically, the decision maker has to determine whether alternative A is preferred to B, alternative B is preferred to A, or he or she is indifferent between the two alternatives. By asking for many such judgments, one can deduce how much weight the decision maker must have given to the various criteria. A critical assumption behind this method is that the trade-offs the decision maker is willing to make between any two criteria do not depend on the levels of the other criteria.

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