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Chapter 7 - How Healthcare Decision Trees Emerge and Function

Published online by Cambridge University Press:  13 July 2023

Ramalingam Shanmugam
Ramalingam Shanmugam
Affiliation:
Texas State University, San Marcos
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Summary

The decision tree is a hierarchical approach to select one among many alternatives and then observing the outcome. The outcome has a different value and a different probability of occurrence. What is a value? A value is a priority. The value can be negative (in dollars) in the case of loss or positive in the case of gain/profit. What is probability? Probability is a numerical speculation of an occurrence in a closed interval [0, 1]. When the probability is zero, the uncertain outcome is unlikely. When the probability is one, the outcome is almost certain.

The expected value is the weighted average of the possible values. Each value is weighted according to its probability of occurrence. The expected value is a guide. Because of the realities of professional and personal life, decision-making is not a one-time action but is repeated.

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Data-Guided Healthcare Decision Making , pp. 188 - 198
Publisher: Cambridge University Press
Print publication year: 2023

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References

Selected references

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