Decision Analysis

is an actual event that may occur in the future.

Using a​ (a)   is a means of organizing a decision situation, including the payoffs from different decisions, given the various (b)   .​

The ​ (a)   results in the maximum of the maximum payoffs.

The ​ (a)   results in the maximum of the minimum payoff.

(a)   is the difference between the payoff from the best decision and all other decision payoffs.

The ​ (a)   criterion minimizes the maximum regret.

The ​ (a)   is a compromise between the maximax and maximin criteria.

The ​ (a)   , is a measure of the decision maker’s optimism.

The ​ (a)   , or ​ (b)   , criterion multiplies the decision payoff for each state of nature by an equal weight.

Expected value is computed by ​ (a)   each decision outcome under each ​ (b)   by the probability of its occurrence.