Chapter3 - Chapter 3 Structuring Decision 1 Structuring...

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1 Chapter 3 Structuring Decision
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2 Structuring Decisions Learning Objectives Fundamental steps in model creation Identify and structure values and objectives Fundamental objectives and hierarchies Means objectives and networks Graphical methods for decision frameworks Influence diagrams Decision trees Concepts for model details Elements Probabilities Cash flows Objectives measurements
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3 Structuring Decisions Three fundamental steps to create a decision model: 1. Identify and structure the values and objectives 2. Structure the decision elements into a logical framework 3. Refine and precisely define all elements of the model
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4 Identifying and Structuring Values and Objectives Identify important issues consistent with values Identify and define relevant objectives Organize objectives Fundamental objectives and hierarchies Means objectives and networks Ensure consistency with context
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5 Fundamental Objectives General and reflect values Organized in hierarchies Paste figure 3.1
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6 Means Objectives Identify how to accomplish fundamental objectives Organized in networks Paste figure 3.2
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7 Decision Context Three criteria for consistency of values-based objectives and decision context: 1. Properly reflective of decision situation 2. Decision owner has authority to make decision 3. Feasible to conduct analysis within resources
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8 Structure Elements into Framework Two graphical methods: Influence diagrams Decision trees
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9 Influence Diagrams Geometric representation of decision
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This note was uploaded on 12/04/2011 for the course BUSINESS 500 taught by Professor John during the Spring '11 term at Kansas.

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Chapter3 - Chapter 3 Structuring Decision 1 Structuring...

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