3_-_Decision_WEB

3_-_Decision_WEB - DS412 OPERATIONS MANAGEMENT DECISION...

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Özgür Özlük     DS 412    Decision Theory DS 412   OPERATIONS  MANAGEMENT DECISION THEORY
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Özgür Özlük     DS 412    Forecasting Decision Theory: Introduction Identify possible future conditions : states of nature List the alternative actions Determine/estimate pay-offs If possible, estimate likelihood of each possible condition Evaluate alternatives according to some decision criterion` Select the BEST!
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Özgür Özlük     DS 412    Forecasting Decision Theory: Pay-Off Tables Possible Outcomes Alternatives Climate Scenario A Climate Scenario B Wind Power $8 million $6 million Solar Power $3 million $10 million
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Özgür Özlük     DS 412    Forecasting Decision Environments 1. Certainty: relevant parameters costs, capacity, demand etc. known 1. Risk: certain parameters have probabilistic outcomes. 1. Uncertainty: impossible to assess the likelihood of possible events
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This note was uploaded on 09/13/2011 for the course DS 412 taught by Professor Eng during the Spring '07 term at S.F. State.

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3_-_Decision_WEB - DS412 OPERATIONS MANAGEMENT DECISION...

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