What Is a Monte Carlo Study? in Addition, Give Examples

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The Answer is A Monte Carlo study is a statistics study that draws repeated samples from a known population and then analyzes the characteristics of the samples. For example, one may draw repeated samples of 3 from a deck of 9 playing cards (all the hearts from 2 through 10). The average value of the 9 cards is 6. The mean value of a typical sample draw will approach 6 as well as the number of draws approaches infinity. This Monte Carlo experiment shows that the mean value of a sample of 3 cards is an unbiased estimator of the population mean. Another example would be a computer simulation where a sample of 40 observations on X and Y is considered the population. A regression is run to ascertain the values of

\hat { \beta } _ { 0 }

and

\hat { \beta } _ { 1 }

. Then 10,000 samples of n=20 can be obtained and

\hat { \beta } _ { 0 }

and

\hat { \beta } _ { 1 }

calculated for each. The average of these 10,000

\hat { \beta } _ { 0 }

s and

\hat { \beta } _ { 1 }

s should equal the population values of

\beta _ { 0 }

and

\beta _ { 1 }

if the estimation technique is unbiased. Monte Carlo studies are useful because they can assess the properties of statistical estimators and tests.

What Is a Monte Carlo Study? in Addition, Give Examples

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What Is a Monte Carlo Study? in Addition, Give Examples

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