# Statistical Simulation

Simulation is used before an existing system is altered or a new system built, to reduce the chances of failure to meet specifications, to eliminate unforeseen bottlenecks, to prevent under or over-utilization of resources and to optimize system performance. Models are simulated versions/results.
Simulation depends on unknown (or external/ impositions/ factors) parameters and statistical tools depends on estimates.

• Simulation follows finite sample properties (have to specify n)
• Reasoning of statistical simulation can’t be proofed mathematically)
• Simulation is used to illustrate the things.
• Simulation is used to check the validity of methods.
• Simulation is a technique of representing the real world via computer program.
• Simulation is act of initiating the behavior of some situation or some process by means of something suitably analogous. (especially for the purpose of study or some personal training)
• A simulation is representation of something (usually in smaller scale).
• Simulation is the art of giving false/artificial appearance.

Issues of simulations

• What distribution do the random variable have
• How do we generate these random variables for simulation
• How do we analyze the output of simulations
• How many simulation runs do we need
• How do we improve the efficiency of simulation?

Updated: Apr 7, 2012 — 10:13 pm