Finding best value product at lowest cost, what technique do I use?

[shivajikobardan]

Cost: 100,99

Read Speed: 545,550

Write Speed: 525,520

Warranty: 3,4

This means that there are 2 products that cost 100$ and 99$. Their read speed is 545 MB/s and 550 MB/s. Their write speed is 525 MB/s and 520 MB/s respectively. Their warranty is 3 years and 4 years respectively. Now, I need to choose the best product between the two.

What technique do I use to solve this? This is just a dummy problem because I want to learn the technique to solve these kinds of problems for bigger scales like 50 different products..

 

[JeffM]

You realize, I hope, that there is no objective way to do this. It depends on what is important to you personally. Look up utility functions.

 

[Cubist]

"best" completely depends upon the requirement. If a read speed of greater or equal to 548MB/s is required then obviously only one product can achieve this.

If you're buying this for a business, then perhaps you require the maximum profit from the use of this product? If this is true then you need to work out how the read and write speeds benefit (or impact) your profit per unit time. How long do you require the product for? Also what are the exact terms of the warranties? A four year warranty isn't much use if they only guarantee a repair within 20 weeks.

 

[shivajikobardan]

You realize, I hope, that there is no objective way to do this. It depends on what is important to you personally. Look up utility functions.

thanks will look at it. is there a possible way to do this? (i mean not exactly what I said but sth others)? I feel I've read about this somewhere but don't remember.

 

[shivajikobardan]

"best" completely depends upon the requirement. If a read speed of greater or equal to 548MB/s is required then obviously only one product can achieve this.

for me it's best out of these all products. I'm buying for myself personal use. It'd be really useful in the future if I learn to calculate this. It eases purchase decision.

 

[blamocur]

is there a possible way to do this?

Yes there is. But the problem is that there are infinitely many ways to do this, and you have to decide how to compare those products. Did you look up "utility functions", as suggested in post #2?

 

[JeffM]

thanks will look at it. is there a possible way to do this? (i mean not exactly what I said but sth others)? I feel I've read about this somewhere but don't remember.

In economic theory, this involves comparing expected utilities. You can if you like express utilities in monetary units, say rupees. So then you must assign rupee values, reflecting your personal requirements and preferences, to the different read speeds, the different write speeds, the different terms of the warranties, the different durations of the warranties, etc. Add all those up for each product and subtract the price of each product from the sum. If both differences are negative, don’t buy either. If at least one difference is positive, buy the product with the greater positive difference.

Notice that this merely formalizes what cubist said a business would do, where he sensibly assumes that monetary profit is the firm’s measure of utility.