Decision Analysis & Game Theory

1. Decision Making Under Uncertainty

Making decisions when probability values are unknown:

• Maximax: Optimistic approach (maximizing maximum possible payoff).
• Maximin: Conservative approach (maximizing minimum possible payoff).
• Laplace: Assuming equal probabilities for all outcomes.

2. Game Theory

• Two-Person Zero-Sum Games: Competitive scenarios where one player’s gain is the other’s exact loss. Includes saddle points and dominance rules.