## Questions for Discussion-Decision Tree

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Sud
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Joined: Sun Jun 29, 2014 4:06 am

### Questions for Discussion-Decision Tree

Question-
Under which of the following scenarios would you not use a Decision tree?

A. When some future scenarios are unknown.

B. When you need to look at the implications of not choosing certain alternatives.

C. When the future scenarios are known.

D. When the outcomes of some of the actions are uncertain.

What is the correct answer and why?

--Sud
namita
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Joined: Wed Dec 11, 2013 10:25 am

### Re: Questions for Discussion-Decision Tree

What is the source of this question?
Sud
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Posts: 129
Joined: Sun Jun 29, 2014 4:06 am

### Re: Questions for Discussion-Decision Tree

It is from Scordo
yogesh
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### Re: Questions for Discussion-Decision Tree

Decision tree is used when multiple path/scenario are there and you r not sure which one to select it.
before selecting any one you compare all the options available and then can select the BEST option based on the comparison.
Sud
Contributor
Posts: 129
Joined: Sun Jun 29, 2014 4:06 am

### Re: Questions for Discussion-Decision Tree

Hi Yogesh,

In case of Decision Tree, we are aware of the various options (i.e. options are KNOWN) as well as the probabilities of each. So we know the future scenarios. Since we have to decide which course-of-action to choose, we calculate EMVs. If we don't know scenarios and probabilities, how can we calculate EMVs? Also if we don't know all scenarios and we carry-on Decision tree analysis, we may end-up choosing a wrong option.

As per me it should be 'A' as we are being asked when NOT to use Decision Tree tool. May be Namita can add her views.

--Sud
sunku65
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### Re: Questions for Discussion-Decision Tree

C
namita
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Joined: Wed Dec 11, 2013 10:25 am

### Re: Questions for Discussion-Decision Tree

Here the word scenario is taken differently by you. Yogesh and sunku are right

Where we have uncertainty we use decision tree. We do know some numbers but ultimately the purpose of this tool is to derive some decision out of future uncertainties. Refer below about EVM

Expected monetary value (EMV) analysis is a statistical concept that calculates the average outcome when the future includes scenarios that may or may not happen (i.e., analysis under uncertainty)