Decision theory, as the name implies, is concerned with the problem of making decisions. Statistical decision theory is concerned with the making of decisions in the presence of statistical knowledge which sheds light on some of the uncertainties involved in the decision problem. We will, for the most part, assume that these uncertainties can be considered to be unknown numerical quantities, and will represent them by θ (possibly a vector or matrix).
KeywordsDecision Rule Loss Function Likelihood Function Prior Information Decision Theory
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