Which of the following best defines Monte Carlo simulation?
A)It is a tool for building statistical models that characterize relationships among a dependent variable and one or more independent variables.
B)It is a collection of techniques that seek to group or segment a collection of objects into subsets.
C)It is the process of selecting values of decision variables that minimize or maximize some quantity of interest.
D)It is the process of generating random values for uncertain inputs in a model and computing the output variables of interest.

Question

Quizplus · Accepted Answer

Monte Carlo simulation involves generating random values for uncertain inputs in a model and then using these values to compute the output variables of interest. It is commonly used to model complex systems with uncertain inputs, and its results can provide insights into how the system might behave under different scenarios. Options A, B, and C describe other types of modeling and decision-making techniques that are not specifically related to Monte Carlo simulation.

Which of the Following Best Defines Monte Carlo Simulation