Term of the Moment
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Definition: decision tree
A hierarchical tree that is used to make decisions in an if-then-else fashion. A type of supervised machine learning, a decision tree comprises decision nodes with two possible outcomes. See machine learning.
Decision Tree Structure
A Loan Example
Starting with the root node, there is no limit to the number of decision nodes, also called "internal nodes." The leaf nodes, also called "terminal nodes," are the outcomes, which may be results or actions that must take place.
Highly simplified, nevertheless this example shows how decisions are made using a decision tree.