What Is Monte Carlo Simulation

Multiple Choice

What is Monte Carlo simulation?

A) It is the process of generating random values for uncertain inputs in a model,computing the output variables of interest,and repeating this process for many trials in order to understand the distribution of the output results.
B) It is a measure of the correlation between two variables X and Y that falls exclusively between the values +1 and -1.
C) It is a ratio of the departure of an estimated parameter from its notional value and its standard error.
D) It is an approach for developing a comprehensive understanding and awareness of the risk associated with a particular variable of interest.