A situation might arise where you need to choose between several courses. Decision tree analysis is a method which helps you to do just that. It is a very important tool when it comes to decision making. It provides highly efficient and productive techniques for laying down and analyzing the available options and simulates the possible outcomes of choosing an option. It also helps you get a clear idea regarding the risks and rewards associated with each possible course of action.
About Decision Tree Analysis
Decision trees find their most practical use in operations research, decision analysis to be precise. It is used to identify a strategy which would help in reaching the desired goal comfortably. Sometimes, practice decisions have to be made online without any recall in absence of complete knowledge. Under such circumstances, a decision tree should be cross-checked by a probability model as a best choice model or online selection model algorithm. Conditional probabilities are calculated with the help of a decision tree in a very descriptive way.
In schools dedicated to business, health economics and public health, Decision trees and other decision analysis tools and methods are taught as examples of operations research or management science methods.