decision theory

Related Terms
Framework of logical and mathematical concepts, aimed at helping managers in formulating rules that may lead to a most advantageous course of action under the given circumstances. Decision theory divides decisions into three classes (1) Decisions under certainty: where a manager has far too much information to choose the best alternative. (2) Decisions under conflict: where a manager has to anticipate moves and counter-moves of one or more competitors. (3) Decisions under uncertainty: where a manager has to dig-up a lot of data to make sense of what is going on and what it is leading to. See also game theory.

Use 'decision theory' in a Sentence

We have implemented new policy's in our company based on decision theory for our lower level management to base other new rules and policy's on.
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Based on new federal legislation, they wanted to us decision theory to help with their best course of action. They knew they needed to do something to continue to thrive in the industry.
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When it came to deciding on a job, I applied a complicated decision theory which involved plenty of logic charts.
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