3 rd Lecture: Bayesian Decision Analysis
Aim of the present lecture
The aim of the present lecture is to introduce the basic principles of risk based decision
analysis. An introduction to the theory of decision analysis is provided, with basis in a simple
example, and the features of prior- posterior- and pre-posterior decision analysis are
illustrated. On the basis of the lecture, it is expected that the students should acquire
knowledge and skills in regard to:
What must be identified before a decision analysis can be performed?
What is a utility function and what role does it play in decision making?
What is the difference between prior and posterior decision analysis?
What is the idea behind the pre-posterior decision analysis?
What role does decision making have in engineering risk assessment?