Cutoff sensitivity
Moving r by one reclassifies an entire probability row, which can materially change both acceptance rate and expected value.
Probability
Enumerate every binomial success-count outcome, apply an acceptance cutoff and separate accepted/rejected payoffs, and reconcile acceptance probability with expected decision value.
EXHAUSTIVE ACCEPT/REJECT STATES
The page applies one inclusive cutoff to the complete exact distribution, labels each row accepted or rejected, and sums probability-weighted payoff across all possible outcomes.
LIVE DECISION RECORD
All count rows are exhaustive; the final column shows each row's contribution to expected decision value.
| Successes k | Exact probability | Cumulative probability | Decision | Row payoff | Expected-value contribution |
|---|
CURRENT CALCULATION PROCESS
P(K=k)=C(n,k)p^k(1-p)^(n-k); accept if k>=r; E[V]=sum over k of P(K=k)V(k)
| Symbol | Meaning and unit | Current value |
|---|---|---|
| trials | Trial count - Fixed opportunities represented by the exhaustive outcome table. | 12 |
| successProbabilityPct | Success probability per trial (%) - Stable probability for each independent trial. | 62 |
| minimumAcceptedSuccesses | Minimum accepted successes - Inclusive decision cutoff: accept when k is at least this count. | 8 |
| acceptedPayoff | Payoff if accepted - Signed decision payoff applied to every accepted row. | 42000 |
| rejectedPayoff | Payoff if rejected - Signed decision payoff applied to every rejected row. | -9000 |
Waiting for valid inputs.
WHO THIS MODEL SERVES
Primary audience: Quality, procurement, experimentation, underwriting, and operations teams applying a count-based accept/reject rule.
Decision boundary: Use when every accepted row shares one payoff and every rejected row another; graded payoff, sequential rules, and dependence need richer decision analysis.
HOW TO BUILD THE DECISION TABLE
OUTCOME-TABLE FUNDAMENTALS
FORMULA AND DEFAULT SUBSTITUTION
Defaults use n=12, p=0.62, and r=8. Rows k=8 through 12 receive 42,000; rows k=0 through 7 receive -9,000. The live model sums each row's probability-times-payoff contribution and reconciles accept plus reject to 100%.
DEEPER DECISION ANALYSIS
Moving r by one reclassifies an entire probability row, which can materially change both acceptance rate and expected value.
If barely passing and perfect performance have different consequences, two flat payoff states conceal value gradients.
Choosing the threshold after seeing the batch creates bias; the rule and payoff basis should be recorded in advance.
WORKED DECISION CASES
Twelve independent lots each pass with probability 62%; the contract accepts at eight or more. The table shows the exact chance and expected payoff of applying that pre-agreed rule.
Requiring 13 successes from 12 trials is rejected as an invalid rule rather than silently producing zero acceptance. That protects the audit record from an impossible specification.
DECISION TERMINOLOGY
EVIDENCE RETENTION
Keep trial protocol, p source, cutoff approval, payoff rationale, currency, acceptance authority, exceptions, and decision date. Store the entire outcome table so the threshold row remains auditable.
LIMITS AND EXCLUSIONS
RELIABLE SOURCES
DECISION-TABLE FAQ
Here payoff is attached to the final accept/reject decision, not accumulated for each success and failure.
Yes. A row with exactly the minimum accepted successes receives the accepted payoff.
The table makes decision classification and each row's expected-value contribution auditable.
Yes. Both accepted and rejected outcomes use signed values.
This two-payoff model is insufficient; use a state-specific payoff table.
No. Expected decision value uses all rows, and governance may depend on downside or constraints beyond the mode.
IMPORTANT DECISION NOTE
The calculator evaluates an entered rule. Authority, fairness, quality standards, reversibility, and consequence definitions remain governance decisions outside the arithmetic.