| Description | The unit introduces statistical models and tools for decision analysis and their application in managerial settings. It will be shown how use of such models and tools can improve the decision process by helping the decision-maker: understand the structure of the decision, incorporate subjective probabilities as a way to portray risk, measure outcomes in a way that is consistent with attitudes toward risk, and understand the value of information. The importance of sensitivity analysis will be emphasised, as well as the need to combine both quantitative and qualitative considerations in decision-making. There will be strong emphasis throughout the unit on hands-on application of decision analysis tools. Cases will be drawn from small business scenarios, the public policy arena, and corporate settings. Decision-making software will be used extensively. |
