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Simulation: Presentation By: Disha Khandige Muralidhar Baliga

Simulation is a representation of reality through the use of a model that reacts similarly to reality under certain conditions. There are two main types of simulation: analogue and computer simulation. Simulation models can be deterministic, stochastic, static, or dynamic. The simulation process involves defining the problem, constructing an appropriate model, running experiments with the model, evaluating the results, and formulating proposals. Monte Carlo simulation involves selecting random observations within a simulation model and is used to solve deterministic and stochastic problems. Common applications of simulation include inventory control, queuing problems, capital budgeting, and financial planning.

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54 views8 pages

Simulation: Presentation By: Disha Khandige Muralidhar Baliga

Simulation is a representation of reality through the use of a model that reacts similarly to reality under certain conditions. There are two main types of simulation: analogue and computer simulation. Simulation models can be deterministic, stochastic, static, or dynamic. The simulation process involves defining the problem, constructing an appropriate model, running experiments with the model, evaluating the results, and formulating proposals. Monte Carlo simulation involves selecting random observations within a simulation model and is used to solve deterministic and stochastic problems. Common applications of simulation include inventory control, queuing problems, capital budgeting, and financial planning.

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samrulezzz
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We take content rights seriously. If you suspect this is your content, claim it here.
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SIMULATION

Presentation By :
Disha Khandige
Muralidhar Baliga
What is Simulation?

Simulation is a representation of reality through the use of a


model which will react in the same manner as reality under a
given set of conditions.
Types of Simulation
 Analogue Simulation

 Computer Simulation

Simulation Models
 Deterministic Model

 Stochastic Model

 Static Model

 Dynamic Model
Disadvantages
 Optimum results cannot be produced

 Difficulty in quantifying the variables

Difficult to make computer program due to large variables &


their inter-relationships

 Expensive & time consuming method


Simulation Process

1.Define the problem

2.Construct an appropriate model

3.A

4.A

5. Evaluate the results of simulation and select best course of


action

6.Formulate proposals for advice to management


Generation of Random Numbers
Random variable:
It is a real valued function defined over a sample space associated with
the outcome of a conceptual chance experiment.

Random variate:
It refers to a particular outcome of an experiment.

Random number:
It is a no. whose probability of occurrence is the same as that of any
other no. in that sequence.

Generation of random numbers:


Arithmetic
Computer generation
Monte-Carlo Simulation

The technique of Monte-carlo involves the selection of


random observations within the simulation model.

It is restricted for application involving random


numbers to solve deterministic and stochastic problems.

This process is generation of simulated statistics that can


be explained in sample terms as choosing a random
variable and substituting this value in standard
probability density function to obtain simulated statistics.
Applications

Inventory Control

Queuing Problems

Capital Budgeting

Financial Planning

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