Understanding Management and Decision Making (Definitions)

Question	Answer
Programmed Decisions	Are familiar and routine decisions
Non-Programmed Decisions	Are less structured and require unique solutions
Risk	Is the chance of incurring misfortune or loss
Uncertainty	Is a situation in there is a lack of knowledge and events, outcomes or consequences are unpredictable
Scientific decision making	Is based on data and uses a logical, rational approach to decision making
Decision tree	A model that represents the likely outcomes fora business of a number of a number of courses of action, on a diagram showing the financial consequences of each
Probability	Is the chance of a particular event occuring
Expected value	The financial outcomes from a specific course of action adjusted to allow for the probability of it occurring
Net gains	The expected values of a course of action minus the costs associated with it

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	Created by jacob holme over 8 years ago