Decision-Making Tools and Expected Monetary Value (EMV)

Image - Decision Makling Tools 3

Decision-Makers’ Toolkit

 

“Decision-making is the cognitive process of selecting a course of action from among multiple
alternatives. Every decision-making process produces a final choice.” That’s what Wikipedia says
anyway. What it doesn’t say is that some decisions must be made for outcomes that will occur in the
future. However, there are a couple of tools that can be put to use in helping make complex decisions,
namely, Expected Monetary Value and Decision Tree Analysis.

 

Expected Monetary Value (EMV)

 

EMV is a balance of probability and its impact over the range of possible scenarios. If you have to make
a decision between two scenarios, which one will provide the greater potential payoff? … Read white paper.