Question

The decision situations wherein the decision-maker chooses to consider several possible outcomes and the probabilities of their occurrence can be stated are called _____________.

a. decisions under risk.
b. decisions under maximum probability.
c. decisions based on expectation.
d. decisions under likelihood.

Answer 1

The correct answer is letter "A": decisions under risk.

Step-by-step explanation:

Decision making under risk involves selecting choices where there are several options and the probabilities of success for each option are known by the decision-maker. The choice with the highest probability is the one likely to be selected. The decision is made based on past experiences, outstanding information about the choices, or the individual point of view.