set 3

Question 1

what is decision tree?

Answer 1

mathematical model that tells manager the outcome of a decision

Question 2

how to workout expected value

Answer 2

success money x success decimal = first answer

failure money x failure = second answer

first answer + second answer= expected value

Question 3

how to work out net gain?

Answer 3

money you put in from the beginning - expected value

Question 4

what is 3 pros + cons for using decision tree?

Answer 4

pro
1. logical approach
2. giving option making them easy to compare
3. shows risks

cons
1. may not considered qualitative factors such as personal choice

2. reliant of the quality of the data
3. external environment = changes quickly.

Question 5

what are 6 influences on decision making ?
remember acronym
miss only eats Rayans ear comfortably

Answer 5

mission = does the decision move closer to the mission or further away

objectives= does the decision help achieve its goals

ethics= is this moral correct decision we are making? how will society view this decision? what impact on stakeholders.

resource constraints= does organisation have financial resources/human resources required.

external environment= what is state of the economy

competition= how will competitors respond to the decision