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Do you make all of your decisions?  Or, maybe you are 18 or older, still young,  and your parents still make all decisions for you.  Do you wish your parents would let you decide?  Maybe you have difficulty making good decisions.  Adolescent decision making is no different than other decision making.  Maybe you are decisive but you donít know if you are making good decisions.    You can learn methods to use in real life situations to make good decision. 

Listen, the decision making steps requires us to: 

  • Define the decision or problem
  • Generate alternative solutions
  • Evaluate outcomes for each alternatives
  • Select an alternative and implement our decision solution

 The selected alternative has the highest expected payoff or level of satisfaction. 

An alternative may have several possible outcomes.  For example, you may decide to ski in Aspen rather than Jackson Hole.  But, the Aspen alternative may have a no snow potential, a light snow potential, and a heavy snow potential.  The decision maker has to assign a likelihood or probability of each outcome occurring. 



We make bad decisions because of our biases.  A bias in making decisions is a preference or partiality that adversely affects our judgment or opinion on an issue or situation.

Two common biases are anchoring and gamblerís bias.  Anchoring represents our preference to not move from a previous position.  An example is an individual not wanting to accept a salary cut even when he or she knows they will receive a larger income from commissions.  Gamblerís bias represents our inability to correctly estimate probabilities because of prior events.  An example of gamblerís bias is the feeling of assurance a head will turn up after three tosses of a coin resulting in three tails.  The ďgamblerĒ has forgotten that each coin toss is independent of another toss.   



 Decision models are used to add structure and clarity to decisions.  The predominant two decision models used by decision makers are ranking matrix and decision tree model


Ranking Matrix Model 

The ranking matrix model is quite often used in decisions whereby a comparison may be made of various alternatives to a decision.  Each alternative in the decision model would have various levels of satisfaction at meeting all of your decision criteria. Numbers represent your level of satisfaction in the ranking model.  An example decision would be the selection of a restaurant for lunch.  Assume you have four restaurant choices and three goals, namely, you want fast, cheap, and good food.  You would rate each restaurant for each goal.  The restaurant with the highest score would be your selected alternative.  From the illustrative Table 1, you would choose Mexican Taco Restaurant.


Table 1.  Restaurant Selection.


Hamburger Joint


Chinese Cuisine

Mexican Taco






















Decision Tree Model

The Decision Tree Model is the model of choice for most complex decisions.  It derives its name from the similarity the model has to a tree albeit laying on its side.  A decision tree  is a graphical representation of a decision.  Specific symbols are used in the decision tree to represent decisions or uncertain events.  Squares represent decisions.  Circles represent uncertain events.  These symbols represent nodes in the decision tree.  Lines, or arcs, emanating from squares represent decision options.  Lines, or arcs, emanating from circles represent chance outcomes.  The lines are commonly called branches. 

 An example decision tree example for a coin toss bet of $10 is shown in Figure 1.  This is a simple decision tree not because it has few branches, but because there is one attribute Ė money.  The decision making tree shows the Bet and Donít Bet alternatives.  If you bet, you have an equal likelihood of winning or losing $10.

Quite often decisions, and decision trees, have multiple attributes.  A simple example would be the decision to purchase a motorcycle or an auto with cost and comfort being the important attributes. 


There is help if you would like to learn more on how to use these models in your decisions.

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