captains decision could be that even though a hurricane may occur, it will not affect the cruise occurring. The same is for the probability of the cruise being a success if she does or does not purchase insurance.
Final Decision
The final decision suggested to Ms. Smith is to buy the cruise insurance...
.
DQ 2 Week 2
How does the science of probabilityaffectdecisions? Why?
The probability is truly helpful in the decision making process and reduces the risk of lost and other undesirable effects of a certain condition. Probability is a measure of how likely it is that something will happen or...
these decisionsaffect the taste of the wine, and therefore the price.
There are three types of Reislings that can be produced depending on residual sugar percentage. For a light bodied wine, there would be no residual sugar and the wine would be dry. For a full-bodied wine, there would be 5...
system will show the probability above, and the payoff below. The “TRUE” and “FALSE” will be described in the optimal course of action section.
Graph 1
For the graph above we can see that the green square is representing a decision that we must make, whether or not to invest in the...
increasing level of pollution in the sea water due to some earth disease (tsunami). Other than that, the consumers also believe that the consumption of seafood might also affect the health of the consumer’s. How far does the belief in consumer’s decision making? What are the other factors besides...
increases the risk of failure for organizational responses and makes it difficult to compute costs and probabilities associated with decision alternatives.
Defined uncertainty as those situations where probability of outcome events is unknown in contrast to risk situations where each outcome has a known...
actions by adversaries also play a role in the probability of a successful decision outcome. Other determinants of the decision process, such as the group's competence, the heuristics used in the process, and the entire organizational set-up in which the group operates is likely to affect the...
of an interruption occurring in the production of Gerber goods, especially if an alternative method is already listed and is seen in the decision tree.
How does the science of probabilityaffectdecisions? Why?
The science of probabilityaffectsdecisions because the person making decisions...
sides of the probability scale. Alternatively, consider the family of functions w ϭ (1 ϩ a)p/
[(1 ϩ a)p ϩ (1 Ϫ p)]. When a ϭ 0, w again reduces to the identity; but
as a grows larger, w does not become more S-shaped, it becomes more
elevated. Under this formulation, greater affect yields a...
outcome of one event does not affect the probability of the outcome of another event, we call this type of events independent. If the outcome of one event affects the probability of the outcome of another event, we call this type of events dependent. For example, If we toss a coin three times. Each...
Sailing which probability set management should use because the factors that take play in that decision are known best by management itself. However, from a strictly financial standpoint, the second set of probabilities would be most advantageous. Nevertheless, ethically speaking, this decision should be made solely upon the factors that affect the future cash flows and not on how to improve financial statements for the current year....
Terms to Know
Statistical independence
Probability of one event occurring does not affectprobability of another event, e.g. flipping a coin or rolling
a dice
Terms to Know
Mutually Exclusive
Two events cannot both occur in a single trial, e.g.
flipping a coin – can’t get both head and...
of the probability distribution of losses. Such measure is useful when contemplating decisions about changing the structure of the supply network or improving its reliability as it accounts for both the severity and the frequency of events. The analysis is based on repeated simulation of the supply...
turns out, that in Lugano
there are several factors at interplay: economical factors, location factors, building factors, etcetera.
Most importantly the interplay between these factors, how they affect each other, is not always
clear. So I decided to lay down the decision process into a Bayesian...
will improve in the coming years or the economy will keep declining and we will have to maintain our already reasonable prices that will be more affordable and appealing to our clients. In both scenarios, the economy and the probability of recovery will affect the organizations decision making...
also affect his performance during the race.
Good decision process and proper execution should come hand in hand together when making a decision. The reason is because they could increase probability of a good outcome.
Outcome is based on three main factors which are deciding, doing and chance...
investment would be paid back. It is very easy to apply and understand for decision makers even who have not been trained in finance discipline. In this scenario, only one investment opportunity is available, payback period does not show its optimal usefulness as it is good in making comparison between...
optimum solutions to the problem.
Basic Probability Concept-will serve as a foundation for other concepts to be discussed such as forecasting,decision theory,markov chain among others.
Probability-is the likehood of the occurence of any particular form of an event it is a chance that something will...
complete sample space.
Independent Events: Two events A & B are said to be independent if the fact that A occurs does not affect the probability of B occurring. Eg. Rolling a die and getting a 6 and then rolling a second die and getting a 3.
Dependent Events: When the occurrence of first event...
analysis also helps the decision maker by describing how changes in the state-of-nature probabilities and/or changes in the payoffs affect the recommended decision alternative.
Risk Analysis
A decision alternative and a state of nature combine to generate the payoff associated with a decision. The...