DECISION RULES FOR REACTING TO NOISY SIGNALS FROM A WARNING SYSTEM.
Technical rept. no. 31, Sep 67-Sep 69,
CALIFORNIA UNIV BERKELEY CENTER FOR RESEARCH IN MANAGEMENT SCIENCE
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Using the minimization of total expected discounted cost as the criterion for optimality, this study investigated via dynamic programming, a class of stochastic sequential decision problems known as warning problems. Specifically, the study investigates two types of warning systems Type I and Type II with single and multiple signals. The dynamic programming models of Type I for single and multiple signals yielded a critical waiting time rule CWT as well as a critical probability value CPV rule as an optimal decision rule. However, for Type II, with two signals, the optimal rule is a CPV rule, but the corresponding waiting time rule, in general, is shown a CWT rule. Author
- Operations Research