SBE chp. 21.rtf - CHAPTER 21DECISION ANALYSIS MULTIPLE CHOICE 1 An uncertain future event affecting the consequence or payoff associated with a decision

SBE chp. 21.rtf - CHAPTER 21DECISION ANALYSIS MULTIPLE...

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CHAPTER 21—DECISION ANALYSISMULTIPLE CHOICE1.An uncertain future eventaffecting the consequence, or payoff, associated with a decision is known asa.unconditional probabilityb.unknown probabilityc.chance eventd.uncertain probabilityANS: C2.The result obtained when a decision alternative is chosen and a chance event occurs is known as3.Nodes indicating points where a decision is made are known as4.Nodes indicating points where an uncertain event will occur are known as5.New information obtained through research or experimentation that enables an updating or revision of the state-of-nature probabilities isa.population informationb.sampling without replacementc.sample informationd.conditional informationANS: C6.The probability of one event given the known outcome of a (possibly) related event is known as7.The probability of both sample information and a particular state of nature occurring simultaneously is
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8.A tabular representation of the payoffs for a decision problem is a9.The uncontrollable future events that can affect the outcome of a decision are known asa.alternativesb.decision outcomec.payoffd.states of natureANS: D10.An intersection or junction point of a decision tree is called a (n)11.A line or arc connecting the nodes of a decision tree is called a(n)12.A decision criterion which weights the payoff for each decision by its probability of occurrence is known as the13.For a decision alternative, the weighted average of the payoffs is known asa.the expected value of perfect informationb.the expected valuec.the expected probabilityd.perfect informationANS: B
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