Stochastic Simulation

Stochastic simulation is a method of modeling real-world systems that involve randomness or uncertainty. Instead of providing a single predicted outcome, it runs many repeated scenarios, each incorporating chance events, to see a range of possible results. This approach helps us understand how unpredictable factors might influence the system's behavior, such as financial markets or disease spread. By analyzing the collection of outcomes, we can make better-informed decisions and estimates about what is likely to happen in complex, uncertain environments.