Statistical Simulation

This is a numerical method used in mathematical problems. The method involves representation of desired quantities as probabilistic characteristics of some random phenomenon, construction of a mathematical model, followed by approximately determining the needed quantities by statistical analysis of observations on the model.

Being a universally accepted method, it is more convenient for use. It is mostly used for computerised problems which involve solving the integral equations. An added advantage to this method is that it does not require more memory in the computer, this makes it easy to use in a wide range of computer OS.

It is used in situations where the problem cannot be solved using precise mathematical methods. Such situations are usually difficult, consume a lot of time and are expensive to analyse. In such conditions statistical simulation can be used to approximate real world results within a short time, less effort and is usually cheaper.

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