The concept of "expected value" in decision-making refers to a probabilistic assessment of potential outcomes. It combines the likelihood of various scenarios with their respective values or payoffs to provide a single number that represents the average outcome if an action is taken multiple times. In this context, expected value helps decision-makers evaluate options by quantifying the potential benefits and risks associated with alternatives.
This approach is particularly useful in complex environments where uncertainty exists. By calculating expected value, decision-makers can objectively compare different options, even when the outcomes are not guaranteed. It allows for informed choices based on the weighted average of possible results, taking into consideration both their probabilities and impacts.
Other options, while related to decision-making in various contexts, do not capture the essence of expected value. Average production costs and design capacity focus on operational metrics, while customer satisfaction is concerned with qualitative assessments rather than a quantitative probabilistic approach. Thus, the correct answer highlights the fundamental role of expected value in evaluating the potential success of various decisions.