ABSTRACT
Business decisions typically have to be made in the absence of complete certainty about the behaviour of factors that will influence their financial outcomes. This chapter is concerned with the techniques and motivations that may be involved in the acquisition of additional information. An engineering consultancy firm is considering the introduction of a new energy economy advisory service. The size of the potential market for the service is known, and the consultancy manager believes that if it is launched the new service will attract 30, 20 or 10 percent of the firms making up that market. The major new concept at the heart of the economical optimising process is the ‘EOL for continuing to acquire information’. The value of EVPI obviously sets the upper limit to the amount management is willing to pay for perfect information when its objective is to minimise the expected money value of repair cost plus information cost.
