BUS 660 GCU QUALITATIVE METHODS
13TH CHAPTER 4 questions with answers
DECISION ANALYSIS - CORRECT ANSWERS ✔✔Used to determine a
recommended decision alternative or an optimal decision strategy when a decision
maker is faced with an uncertain and risk-filled pattern of future events. The goal of
decision analysis is to identify the best decision alternative or the optimal decision
strategy given information about the uncertain events and the possible consequences
or payoffs.
Chance event - CORRECT ANSWERS ✔✔An uncertain future event affecting the
consequence, or payoff, associated with a decision.
STATES OF NATURE - CORRECT ANSWERS ✔✔The outcomes of the chance
events in decision analysis.
Bayes' theorem - CORRECT ANSWERS ✔✔A theorem that enables the use of
sample information to revise prior probabilities.
Branch - CORRECT ANSWERS ✔✔Lines showing the alternatives from decision
nodes and the outcomes from chance nodes.
Chance nodes - CORRECT ANSWERS ✔✔Nodes indicating points where an
uncertain event will occur. These take the form of ovals in influence diagrams.
Conditional probabilities - CORRECT ANSWERS ✔✔The probability of one event
given the known outcome of a (possibly) related event.
, Consequence - CORRECT ANSWERS ✔✔The result obtained when a decision
alternative is chosen and a chance event occurs. A measure of the consequence is
often called a payoff.
Consequence nodes - CORRECT ANSWERS ✔✔Nodes of an influence diagram
indicating points where a payoff will occur.
Conservative approach - CORRECT ANSWERS ✔✔An approach to choosing a
decision alternative without using probabilities. For a maximization problem, it leads
to choosing the decision alternative that maximizes the minimum payoff; for a
minimization problem, it leads to choosing the decision alternative that minimizes
the maximum payoff.
Decision alternatives - CORRECT ANSWERS ✔✔Options available to the decision
maker.
Decision nodes - CORRECT ANSWERS ✔✔Nodes indicating points where a decision
is made. These take the form of rectangles in influence diagrams.
Decision strategy - CORRECT ANSWERS ✔✔A strategy involving a sequence of
decisions and chance outcomes to provide the optimal solution to a decision
problem.
Decision tree - CORRECT ANSWERS ✔✔A graphical representation of the decision
problem that shows the sequential nature of the decision-making process.
13TH CHAPTER 4 questions with answers
DECISION ANALYSIS - CORRECT ANSWERS ✔✔Used to determine a
recommended decision alternative or an optimal decision strategy when a decision
maker is faced with an uncertain and risk-filled pattern of future events. The goal of
decision analysis is to identify the best decision alternative or the optimal decision
strategy given information about the uncertain events and the possible consequences
or payoffs.
Chance event - CORRECT ANSWERS ✔✔An uncertain future event affecting the
consequence, or payoff, associated with a decision.
STATES OF NATURE - CORRECT ANSWERS ✔✔The outcomes of the chance
events in decision analysis.
Bayes' theorem - CORRECT ANSWERS ✔✔A theorem that enables the use of
sample information to revise prior probabilities.
Branch - CORRECT ANSWERS ✔✔Lines showing the alternatives from decision
nodes and the outcomes from chance nodes.
Chance nodes - CORRECT ANSWERS ✔✔Nodes indicating points where an
uncertain event will occur. These take the form of ovals in influence diagrams.
Conditional probabilities - CORRECT ANSWERS ✔✔The probability of one event
given the known outcome of a (possibly) related event.
, Consequence - CORRECT ANSWERS ✔✔The result obtained when a decision
alternative is chosen and a chance event occurs. A measure of the consequence is
often called a payoff.
Consequence nodes - CORRECT ANSWERS ✔✔Nodes of an influence diagram
indicating points where a payoff will occur.
Conservative approach - CORRECT ANSWERS ✔✔An approach to choosing a
decision alternative without using probabilities. For a maximization problem, it leads
to choosing the decision alternative that maximizes the minimum payoff; for a
minimization problem, it leads to choosing the decision alternative that minimizes
the maximum payoff.
Decision alternatives - CORRECT ANSWERS ✔✔Options available to the decision
maker.
Decision nodes - CORRECT ANSWERS ✔✔Nodes indicating points where a decision
is made. These take the form of rectangles in influence diagrams.
Decision strategy - CORRECT ANSWERS ✔✔A strategy involving a sequence of
decisions and chance outcomes to provide the optimal solution to a decision
problem.
Decision tree - CORRECT ANSWERS ✔✔A graphical representation of the decision
problem that shows the sequential nature of the decision-making process.
