Decisions 1

set a goal
To reveal, relevant factors, constraints and dependencies

Decision-making process:

conception is real for short-term period

each alternative. Also probability of each outcome realization is known.

Some objective knowledge is presented

chances

everything and just choose a project that will bring the

That is, we either maximize benefit or minimize costs

is called the optimization analysis
3 optimization methods:
marginal analysis

any level of production and sales
Our task is to find

Use the concepts of marginal costs and marginal revenue

revenue, costs and profit
Total revenue, costs, profit

scarce resources between competing works
The Manager limits himself to the

costs functions are unknown precisely, and are exposed to changes
The

The basic rule of the decision: to accept the offer, increasing profits and reject - reducing

Refers to the change of costs and revenues associated with a specific solution

costs that are fixed point in the interval, are not

Short-term conception

Many managers do not use the incremental terms, and make decisions based on the average values of the total cost

Incorrect short-term solutions