lect19- Monte Carlo Simulat

lect19- Monte Carlo Simulat - ISE 460 Engineering Economy...

Info iconThis preview shows pages 1–11. Sign up to view the full content.

View Full Document Right Arrow Icon
Click to edit Master subtitle style 12/1/10 ISE 460: Engineering Economy University of Southern California Fall 2010 Joseph Chow Week 12: Lecture 19
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
12/1/10 Latest Grade Statistics Undergraduate Graduate 22
Background image of page 2
12/1/10 HW Schedule Summary 12/1/10 33 HW #7, due 11/19/10 Lecture 16 7.1 7.2 Lecture 18 7.3 Lecture 19 7.4
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
12/1/10 Review Prior Deterministic methods of economic analysis Sensitivity analysis, breakeven analysis This Week Stochastic methods of economic analysis – incorporating random variables Numerical methods: Monte Carlo simulation 12/1/10 44
Background image of page 4
12/1/10 On Tuesday we covered… How to obtain NPW pdf/cdf as a simple function of random variables Know what kind of questions can be answered with the result Evaluate random NPWs based on Pareto optimality Recognize the limitations of these “closed-form” approaches in the real 55
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
12/1/10 Simulation 66
Background image of page 6
12/1/10 Risk Simulation 12/1/10 77 Analytical approach not always convenient or even feasible! Interdependencies of variables Functions may not be simple Monte Carlo Simulation: do random draws of distributions of random variables many times, and accumulate results to develop a
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
12/1/10 Monte Carlo Simulation of Ten 12/1/10 If you roll 10 6-sided dice, what is the probability the sum will be less than 30? We know each 6-sided die has the following cumulative distribution: What is the CDF for the sum of 10 dice rolls???
Background image of page 8
12/1/10 PMF and CDF of Sum of 10 Dice Rolls 99
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
12/1/10
Background image of page 10
Image of page 11
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 11/30/2010 for the course ISE 460 taught by Professor Bottlik during the Spring '06 term at USC.

Page1 / 33

lect19- Monte Carlo Simulat - ISE 460 Engineering Economy...

This preview shows document pages 1 - 11. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online