Normative decision theory is a framework that helps individuals and organizations make rational choices by evaluating the best possible outcomes. It focuses on how decisions should be made based on logical reasoning and established criteria, rather than how they are actually made in practice. This theory often involves the use of mathematical models to assess risks and benefits associated with different options. The theory emphasizes the importance of consistency and coherence in decision-making processes. By applying principles from fields like economics and psychology, normative decision theory aims to guide people toward making choices that maximize their utility or satisfaction.