In decision tree analysis, expected benefit is computed by:
A) Multiplying expected outcomes by the financial amount appropriate.
B) Multiplying expected outcomes by its associated probability.
C) Adding expected outcomes together.
D) Subtracting expected costs from expected outcomes

Question

Quizplus · Accepted Answer

Expected benefit in decision tree analysis is computed by multiplying each possible outcome by its associated probability and then summing these products. This method incorporates the likelihood of each outcome occurring, providing a weighted average that represents the expected benefit.

In Decision Tree Analysis, Expected Benefit Is Computed By