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Dealing with uncertainty is a dif cult problem; decision analysis relies upon probability theory to capture the uncertainty faced by the decision maker In the engineering of a system the uncertainty is not often described by existing data and interpretable as the long-run frequency of a set of known events Instead the uncertainty deals with processes that change with time and for which no (or at most a few) known events have occurred Instead of ignoring the uncertainty faced in the engineering of a system, decision analysis permits the engineers to capture the expert judgment of the engineers, stakeholders, and other experts and use this information to provide insights about the design choices with the best information available at the time Recent advances in decision analysis provide graph-theoretic models for representing probabilistic dependence (relevance diagrams) and decisions problems (in uence diagrams).

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Once uncertainty is modeled explicitly, the risk preference of the decision maker has to be addressed as part of decision analysis The concepts of risk aversion, neutrality, and preference are de ned mathematically and illustrated as part of the decision analysis process Using the decision maker s risk preference requires computing the certainty equivalent as the inverse of the utility function Clearly, it is inappropriate to use the sophisticated tools of decision analysis for every decision that is part of the engineering of a system Many times engineers have described the bene t of thinking about the decision in the terms of decision analysis At other times developing the value model and using a quick scoring and weighting evaluation provides insight into which alternatives are serious and which should be ignored.

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For really complex and contentious decisions, the full power of decision analysis can provide an explicit and rational process for de ning and discussing the alternatives to reach a conclusion consistent with the values of the stakeholders and the uncertainty as de ned by relevant experts PROBLEMS 131 In de ning reliability of a system, we talk about the probability of a failure Failure here is an event or distinction, but not one that passes the clarity test As a result, systems engineers work very hard to focus on the distinction, mission failure, where a mission failure is a failure that precludes the user from completing her/his mission This de nition still does not pass the clarity test because we have not de ned the mission, a de nition that is system and context dependent For the elevator system where you work or go to school, a.

Source: SAMHSA (2001). State Estimates of Substance Abuse. Available at http://www. oas.samhsa.gov/ Note: Percentages are approximate and represent an extrapolation from SAMHSA data and census figures. SAMHSA data do not include drug use among people under the age of 12 years, so these are rough population estimates. Reported drug use does not necessarily mean drug problems.

De ne mission in a way that meets the clarity test b De ne as many failures as possible and show which would be classi ed a mission failure Be sure to keep the clarity test in mind when de ning these failures..

experience. The only training I had came from a couple of books I had read. After a few months of being in the rental business, I was beginning to have second thoughts about my new career in real estate. Actually, the tenants weren t that bad. It just seemed to me that this so-called buy-and-hold approach was going to be a long and painstaking process. At the rate I was going, it would be a long time before I could even begin to think about retirement. After about a year, I began to consider the idea of selling the houses to the tenants who lived there and thought about how I could structure the sale in a manner that would be agreeable to them. I decided to carry the note myself, or provide owner financing, as it is sometimes referred to. I agreed to let the tenants apply a portion of the rent they had been paying. Take a look at Exhibit 6.2 to see how the deal was structured. Now take a minute to study Table 6.1. The worksheet you see is a proprietary model I developed that I use to quickly and easily analyze potential value play investment opportunities. I call it The Value Play Rehab Analyzer. Once I have gathered the necessary

11 / Property, Plant, and Equipment (IAS 16)

in the areas of dead air circulation, can rapidly give rise to unsightly mould growth which is also dif cult to eradicate once established. By dead areas of the room is meant those corners which are not subject to particularly good ventilation.

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