Question

The following table gives the estimated acquisition cost and expected earth coverage per day in percentage terms) for five possible satellite architectures. Assume that greater earth coverage corresponds to better performance. Use this table to answer questions (1) through (3). Satellite #1 Satellite #2 Satellite #3 Satellite #4 Satellite #5 Estimated Earth coverage acquisition cost per day (%) ($M) 25 240 24 130 21 150 18 180 11 80 1. (4) Calculate the benefit/cost ratio for each satellite alternative. Develop a graph to display the ratios. 2. (4) Develop a scatter plot of the earth coverage vs. estimated cost to determine which satellite design provides the most "bang for the buck." 3. (2) Which satellite design would you recommend based only on cost and earth coverage? Why?

Answer 1

	Calcuation of benefit cost ratio
1	Greater earth coverage means better performance . So the benefit will be earth coverage
	B/C ratio	Benefit/ Cost
		Benefit	Cost	B/C
	Satellite 1	25	240	0.10
	Satellite 2	24	130	0.18
	Satellite 3	21	150	0.14
	Satellite 4	18	180	0.10
	Satellite 5	11	80	0.14
	Graph of ratios
2	— Series1 0.05 0.00 - 1 2 3 4 5
	Cost 25 Axis Title 11 Cost 10 Axis Title 20 30
3	We recommend Satellite 2 because of highest benefit cost ratio i.e 0.18