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3E3 Modelling Risk > Decision Analysis > Flashcards

Flashcards in Decision Analysis Deck (3)
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1
Q

How do you find the expected monetary value EMV

A

Multiply the different possible payoffs by their probabilities and sum

2
Q

What is EVPI

A

Expected value of perfect information

EVPI = Money that I make with new information
- money that I make without it

= EMV w/ PI - EMV.

3
Q

What is EVSI

A

Expected value of sample information (EVSI) is the EMV with sample/imperfect information minus the EMV without sample
information.