SHS Web Conf.
Volume 61, 2019Innovative Economic Symposium 2018 - Milestones and Trends of World Economy (IES2018)
|Number of page(s)||10|
|Section||Strategic Partnerships in International Trade|
|Published online||30 January 2019|
Randomness vs. fuzziness in managerial decision-making
The Institute of Technology and Business in České Budějovice, School of Expertness and Valuation, Okružní 517/10, 37001 České Budějovice, Czech Republic
* Corresponding author: firstname.lastname@example.org
Managers often deal with uncertainty of a different nature in their decision processes. They can encounter uncertainty in terms of randomness or fuzziness (i.e., mist, obscurity, inaccuracy or vagueness). In the first case (randomness), it can be described, for example, by probability distribution, in the second case (fuzziness) it cannot be characterized in such a way. The methodological part of the paper presents basic tools for dealing with the uncertainty of both of these types, which are techniques of probability theory and fuzzy approach technique. The original contribution of the theoretical part is the interpretation of these different techniques based on the existence of fundamental analogies between them. These techniques are then applied to the problem of the project valuation with its “internal” value. In the first case, the solution is the point value of the statistical E[PV], in the second case the triangular fuzzy number of the subjective E[PV]. The comparison of the results of both techniques shows that the fuzzy approach extends the standard outcome of a series useful information. This informative “superstructure” of the fuzzy approach compared to the standard solution is another original benefit of the paper.
Key words: Uncertainty / Probability / Fuzziness / Expected value / Fuzzy number
© The Authors, published by EDP Sciences, 2019
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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