New Ad 1

New 1

الأحد، 18 سبتمبر 2016

Monte Carlo Simulation



Monte Carol simulation is a practical tool used in determining contingency and can facilitate more effective management of cost estimate uncertainties. Given the right Monte Carlo simulation tools and skills, any size project can take advantage of the advancements of information availability and technology to yield powerful results.

  Monte Carlo sampling refers to the traditional technique for using random or pseudo-random numbers to sample from a probability distribution. The term Monte Carlo was introduced during World
War II as a code name for simulation of problems associated with development of the atomic bomb. Today, Monte Carlo techniques are applied to a wide variety of complex problems involving random
behavior. A wide variety of algorithms are available for generating random samples from different types of probability distributions.
Monte Carlo sampling techniques are entirely random — that is, any given sample may fall anywhere within the range of the input distribution. Samples, of course, are more likely to be drawn in areas
of the distribution which have higher probabilities of occurrence. In the cumulative distribution shown earlier, each Monte Carlo sample uses a new random number between 0 and 1. With enough iterations,
Monte Carlo sampling "recreates" the input distributions through sampling. A problem of clustering, however, arises when a small number of iterations are performed


In PMI-RMP Exam Expect to See between 4-7 questions that ask you to interpret the Monte Carlo simulation diagram, see the below example;





As you see, the diagram above shows histogram and a cumulative distribution, in Exam, Expect that you will be asked for example to find P-45 or P50, it is simply means probability of 50% for achieving a specific cost, which as illustrated from  the cumulative distribution above equal to 74,753,000$

Also expect to find questions such as, if the owner has a budget of the project equal to 60,000 $ and he wants to have a confidence level of 50%, what is the contingency reserve that the project manager needs to allocate to achieve this confidence level? the answer is the difference between 60,000 and 74,753,00 $

the characteristics of Monte-Carlo simulation is also a big topic in the exam and you have to understand them well 

Note that the above diagram was for a cumulative distribution given, you have to distinguish with the same histogram but with a Normal distribution given as the below diagram






Here the summation of the vertical bars starting from the left side will give the cumulative distribution as shown on the table at the right side

ليست هناك تعليقات:

إرسال تعليق

K4

Most Repeated Topics in Reading Section in TOEFL Exams

Reading Section is one important part in both IELTS & TOEFL Exams which constitute 25% of the overall score in exam. After studying Hun...

text ad

Sidebar

lacademy