CERTAIN 

 EQUIVALENT 

 WORTH 



RISK 



PREFERENCE MODEL 



WORTH 



TIME 

 PREFERENCE MODEL 



VALUE VARIABLES 



VALUE MODEL 



OUTCOME VARIABLES 



STRUCTURAL 

 MODEL 



I 



FIXATED 



ALEATORY 



POTENT \ IMPOTENT 



STATE VARIABLES 



DECISION VARIABLES 



SYSTEM VARIABLES 



Figure 4. Hierarchy of models needed in decision analysis. 



(From Matheson and Howard 1968. Used with permission.) 



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