Logical Decisions - Classweb

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Bibliography This brief bibliography provides an introduction to the literature of decision analysis. The methods described in these books are the basis of the algorithms used in Logical Decision. The underlying assumptions, mathematics and philosophy of the approach are discussed in much more detail than is possible in this manual. These books also contain detailed bibliographies that can guide you to the other information sources available. A more extensive bibliography is available on the Logical Decisions web site at www.logicaldecisions.com. Bell, D., Raiffa, H, and Tversky, A. (1988) Decision Making: Descriptive, normative, and Prescriptive Interactions. Cambridge University Press. A collection of papers that discuss the differences between the the use of decision analysis to describe how people make decisions, how people should make decisions and how people can be helped in making decisions. Clemen, Robert T. (1990) Making Hard Decisions: An Introduction to Decision Analysis. PWS-Kent Publishing Company, Boston. An excellent introductory textbook in decision analysis. French, S. (1986) Decision Theory: An Introduction to the Mathematics of Rationality. John Wiley and Sons. An excellent overview of the field of decision analysis, with discussions of single and multiple measure utility theory and of competing methods for comparing alternatives. Keeney, R. L. (1980) Siting Energy Facilities. Academic Press. A more accessible presentation of the ideas developed in Keeney and Raiffa, with an application to the specific problem of siting power plants. Keeney, R. L. and Raiffa, H. (1976) Decisions with Multiple Objectives: Preferences and Value Tradeoffs. John Wiley. Bibliography B-1
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Logical Decisions Decision Support
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Table of Contents Table of Contents
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Assessing Weights with Weight Ratio
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Assessing Interactions Between Meas
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Introduction Real decisions aren't
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S E C T I O N Requirements and Inst
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"Logical Decisions". This program g
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Quick Start Introduction This secti
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Defining goals and measures. In LDW
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Figure 3-1. The SUF for "Years of E
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weights of the measures. All of the
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S E C T I O N Basic Tutorial 4
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Figure 4-1. Tutorial overview. 4-2
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Now lets make sure the alternatives
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Assume you have decided that you wi
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Next we will enter the measures for
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Defining Preferences The alternativ
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1. Select the Assess::Common Units
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almost equally unacceptable, while
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1. Select the Assess::Common Units
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When you do this, the tradeoff grap
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1. Select "Performance" and "Price"
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8. Click on the "Equal" button to t
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Figure 4-11. Display generated by R
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Figure 4-13. Overall ranking for tr
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Figure 4-15. Graph showing sensitiv
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You can see the completed introduct
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Advanced Tutorial This tutorial sec
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Probabilities There is a problem wi
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This information indicates that the
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A uniform distribution is defined b
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On the left is a list of the possib
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Figure 5-2. Example of Results::Unc
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screen a large database for the alt
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9. LDW will ask if you want to appe
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commit to buying their truck before
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see that the rankings for all the a
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S E C T I O N Using LDW 1: Structur
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The Edit::Insert option. The Insert
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! Summary -- view a dialog box that
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structure like an organization char
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If you check the Show Assessment St
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saves it for later pasting. When yo
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You can create a new Matrix view by
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The quick entry view shows the alte
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Structuring Goals The goals in an L
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these two fields to describe each m
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the hierarchy. In the Matrix view,
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! Point Estimate -- use a single nu
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Figure 6-12. Example of a measure l
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Figure 6-14. Example of a measure l
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pass, LDW replaces each probabilist
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Figure 6-17. Dialog box for definin
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Figure 6-18. Measure Category Dialo
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S E C T I O N Using LDW 2: Assessin
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measure utility functions for the g
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information as possible when you ch
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measures with categories require mu
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The "Reset" button deletes any asse
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You can change the shape of the cur
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Figure 7-4. Utility Assessment Scre
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very different from the average of
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Figure 7-6. Assessment matrix for A
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You can, however, leave the assessm
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properties dialog box can be select
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the same level. LDW provides a grap
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options in the Hierarchy menu to ad
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The check box labeled "Allow Repres
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Next you will see a tradeoff assess
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The Tradeoff::Use Alternatives to S
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Figure 7-13. Example of Direct Entr
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You can think of the importance num
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Figure 7-15. Assessment Screen for
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When you have selected two members
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("importance strength") that best d
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clicking on the "Initialize" button
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Set a Small k. The Enter Small k op
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select the tradeoff you would like
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Figure 7-18. Effects of consistency
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Using LDW 3: Reviewing Results Intr
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The curve shows how the utility fun
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The tradeoff graph has one measure
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When you select the option, you are
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the relative weights of the "Price"
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epresents a computer alternative wi
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Figure 8-11. Example of Review::Ass
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e true even if the measure has a ve
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an analysis are included in exactly
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Graph Weights The Graph Weights dis
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Figure 8-16. Results::Rank Alternat
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Figure 8-18. Dialog box for Results
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You can use the measure equivalents
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simulation for each alternative usi
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Sensitivity Graphs Sensitivity grap
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You can view a sensitivity table by
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Figure 8-28. Example of Results::Sc
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Figure 8-30. Example of Results::Sc
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In the dialog box, you are asked to
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Figure 8-34. Dialog box for Results
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Graph an Alternative The graph an a
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Figure 8-38. Example of Results::Gr
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Finally, the two radio buttons on t
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Figure 8-43. Example of Results::Co
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Printing and Saving Windows You can
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The dialog box will show you the fi
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Figure 8-45. Dialog box for Edit::C
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Changing the range for utility. You
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Figure 8-50. Dialog box for Prefere
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the current color for that type of
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copies the selected objects to the
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analysis with the skeleton analysis
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Figure 8-55. Dialog box for File::I
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the other measures. The measure nam
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The idea of the Import Structure op
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Next, LDW asks you if it should app
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Other Options utility function for
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In addition, the Window menu contai
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In Depth Introduction This section
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A third example is a portfolio deci
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Each alternative has a raw score (c
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into more specific goals continues
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Measures in LDW You define measures
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computed measure levels to common u
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Converting the Measures to Common U
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Figure 9-2. Example of linear (stra
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For an example of the mid-level spl
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Since U(L0) = U(80) = 0 and U(L1) =
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Figure 9-5. Summary of SUF assessme
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describe two alternatives: A, which
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with equal chances of 40 and 70 per
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In the original formulation of the
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1 Equal Importance Two activities c
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You begin the process by selecting
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Figure 9-7. Effects of goals with a
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0.5. Then the weight assigned to "P
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! You can use the "Smarter Method"
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allocates this weight before comput
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nth root of the product of the rati
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Figure 9-8. Summary of estimating t
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on the decision maker's response, L
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Figure 9-10. MUF assessment figure
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Now think of adjusting P so that th
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Another approach is to use the rang
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Figure 9-12. Quantitative range vs.
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If a measure’s range changes, LDW
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Figure 9-14 is an example of the ov
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Similarly, a single member can have
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chance having 160 hp (the most pref
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A probability of less than 0.5 for
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Interpreting the Ranking Results LD
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S E C T I O N Examples 10
Page 316 and 317: the idea that other manufactures an
Page 318 and 319: The completed goals hierarchy is sh
Page 320 and 321: Buying a House The ranking results
Page 322 and 323: Figure 10-5. Goals hierarchy for bu
Page 324 and 325: Overall goal Quality goal Costs goa
Page 326 and 327: The preference assessments were don
Page 328 and 329: Figure 10-9. Goals hierarchy for re
Page 330 and 331: ! Noise, ! Agricultural Impacts, an
Page 333: S E C T I O N Commands Summary 11
Page 336 and 337: Assess Menu Edit Menu The Assess me
Page 338 and 339: File Menu Edit::Insert Lets you add
Page 340 and 341: utility function” if the active g
Page 342 and 343: Matrix Menu ! Hierarchy -- options
Page 344 and 345: Results::Dynamic Sensitivity See th
Page 346 and 347: Review::Compute Utilities Compute t
Page 348 and 349: Tradeoff Menu View Menu LDW display
Page 351: S E C T I O N Glossary 12
Page 354 and 355: Common Units Certainty Equivalent C
Page 356 and 357: LDW File Level Lottery Measure assi
Page 358 and 359: MUF MUF Formula See also: Alternati
Page 360 and 361: Preference Set Probabilistic Level
Page 362 and 363: Tradeoff Trial program decides whic
Page 365: Bibliography B
Page 369: Appendix A
Page 372 and 373: for all measures i except 1 and 2.
Page 375: Index I
Page 378 and 379: probabilistic ..............6 - 29
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