Notes - Notes TESTS: Make sure to explain exactly how you...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Notes TESTS: Make sure to explain exactly how you got your answers (explanations and equations). Even if you did not get the exact answer, your reasoning might still give you credit. Monday, August 29, 2011 Chapters 1, 2, A: Decision Analysis Decision Approaches 1. Decide what your objective is. There is no limit, but there needs to be a goal. a. Optimization (more mathematical) - best of all approaches b. Heuristic c. Simulation Environment 1. Certainty 2. Uncertainty 3. Risk (every situation) Tools 1. Decision Matrix (Table) 2. Decision Tree Decision Criteria 1. Maximum (best of worst) – pessimist criteria; risk avoider 2. Minimum (best of best) – optimist criteria; risk seeker 3. Expected Value (Laplace) – aka, Probability * # of Outcomes Wednesday, August 31, 2011 States of Nature↕ Alternatives↔ Rain .4 No rain .6 bring 8 7 bring 1 10 Worst Best Equal Value 7 8 7.4 1 10 6.4 Bring Don’t bring On POM, go to Decision Analysis, New à Decision Table or Decision Tree.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
***Expected Value is NOT on the exam!!!*** Wednesday, September 7, 2011 Forecasting
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 5

Notes - Notes TESTS: Make sure to explain exactly how you...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online