ABSTRACT
The rational methodology for conceptualizing, analyzing and solving problems that require decision to be made is an approach referred to as decision analysis. The first step in the decision analysis approach for a given problem situation is to identify the alternatives that may be considered by the decision maker. The second step is to identify the future events that might occur. These future events, which are not under the control of the decision maker, are referred to as the states of nature. The payoff, which is the outcome resulting from making a certain decision, and the probability of occurrence of a particular state of nature need to be estimated. This information is organized in what is called a payoff or a decision table. In this section, decision analysis using decision tables will be discussed first. Then, the classification of the decision situations will be introduced.
