Selection of Investment Using a Decision Tree
R. Kalfakakou, Kyriakos Anastasiadis, P. Christidis · Contributions to management science · 1997
An important decision making problem is the selection between alternative forms of investment, given the expected demand distribution of each investment for the forthcoming years. The crucial criterion is the expected net profit. The profit lost, in case the demand cannot be satisfied, and the cost of the remaining products, if production exceeds demand are taken into consideration. A decision tree is used in order for the initial optimum investment to be selected, as well as in order for a general investment strategy to be developed.