Analysis of the Principle and Two Applications for Monte-Carlo Simulations
DOI:
https://doi.org/10.54097/3dg18k50Keywords:
Monte-Carlo analysis; financial pricing; mathematical simulation.Abstract
As a matter of fact, stochastic process and sampling algorithms are widely used in the state-of-art numerical simulations. In order to evaluate the random effect, the means of Monte-Carlo simulations are widely adopted and used to obtain a convergence or trending results. With this in mind, this essay mainly talks about the two applications of Monte Carlo simulation and the impact of it toward the society and human race. To be specific, firstly, the origin of Monte-Carlo simulation was revealed and its history of development was elaborated. After that, the basic concept of Monte-Carlo analysis was formulated as well as the sampling process of it is done briefly. All those foreshadows were aimed at assisting the readers to obtain a basic idea of this simulating method and be able to comprehend the relatively sophisticated applications, including financial and computer science knowledge. Overall, these results shed light on guiding further exploration of Monte-Carlo simulations.
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