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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Decision Tree
I have few questions related to decision tree.
1) Decision Point is where we have to decide what is the decision base of the question we have to answer upon.
2) Outcome Point is where we have many outcomes on each level which is based on probabilities given on each outcomes.
3) Since decision tree involved expected value calculation using probabilities so I have a question can we deal decision tree just like profit table in table format because it involves price & variable cost to get contribution on each level.
All three off your statements are correct (including the last one).
Although you cannot be required to draw a tree in the exam, you could be given a tree in the question and be asked to deal with it. If that were the case then it would be more efficient to state the position at each point (and they would be labelled in the exam) as I do in my lecture rather then set up a table which would be effectively repeating the tree.