The expected value of perfect information is inversely related to losses predicted.

Question

Quizplus · Accepted Answer

The expected value of perfect information (EVPI) measures the maximum amount a decision-maker should be willing to pay for information before making a decision. It is not inversely related to losses predicted; rather, it is directly related to the reduction of uncertainty or improvement in decision-making that the information would provide, potentially reducing the expected losses or increasing expected gains.

The Expected Value of Perfect Information Is Inversely Related to Losses