24 lines
860 B
Markdown
24 lines
860 B
Markdown
# Perfect Information
|
|
|
|
In [[strategy]], perfect information is hypothetical information
|
|
that would eliminate some defined [[uncertainty]].
|
|
|
|
## Expected Value of Perfect Information
|
|
|
|
Expected value of perfect information (EVPI)
|
|
is the price that one would be willing to pay
|
|
in order to gain access to perfect information.
|
|
|
|
The perceived *value* of decreased uncertainty
|
|
must be weighed against its *cost*.
|
|
|
|
This concept provides the basis for the solution of one or more [[open-problems]].
|
|
To reduce [[risk]] in [[construction-estimating]],
|
|
an organization pays in estimator hours.
|
|
These hours have a direct cost in salary and benefits,
|
|
however the greater cost is the opportunity cost
|
|
of tying up an estimator who could otherwise be starting a new project.
|
|
|
|
In many cases, the utility of doubled throughput
|
|
far outweighs the increased risk of individual bids.
|