decision analysis Flashcards
when do we use the decision analysis?
there are multiple possible outcomes of the proposed courses of action and chance is an important factor in determining which outcome occurs
What is a decision analysis?
it is defined as or any framework or strategy for handling complex decisions so that they can be more readily evaluated by the human mind
What is included in the decision analysis?
mathematical equations
payoff matrices
process diagrams or process flow charts
decision trees
What is a payoff matrix?1
it is a tabular presentation of data in the decision actions and provides a better visual presentation of the data
What is a process diagram or flowchart?
is a technique were the selection process is presented in a dynamic sequence of events, information flows, information processing steps, and decision making steps
this approach is used in computer programming and is gaining ground in diagnostic work and areas of artificial intelligence
What is the decision tree analysis?
graphical method of epressing, in chronological order the alternative actions available to the decision maker and the choices determined by chance
What is a decision node?
choices are respresented by squres in a decision tree
What are chance nodes?
chance events or states of nature are represented by circles (e.g. response to treatment)
What are lines or branches in a decision tree?
follow each node and lead to next event, they must include all possible outcomes and be mutually exhaustive
What happens after each chance noe:
there is a probability that an event occurs
the probabilities a chance node must add up to 1.00
these probabliities can be assessed form literature, experimental data or expert opinion
What is the expected outcome of a decision tree?
- usually monetary, are entered at the far right of the tree branches
