Why Should I Use Monte Carlo Simulation?

Whenever you need to make an estimate, forecast or decision where there is significant uncertainty, consider Monte Carlo simulation – if you don’t, your estimates or forecasts could be way off the mark, with adverse consequences for your decisions! Dr. Sam Savage, a noted authority on simulation and other quantitative methods, says “Many people, when faced with an uncertainty … succumb to the temptation of replacing the uncertain number in question with a single average value. I call this the flaw of averages, and it is a fallacy as fundamental as the belief that the earth is flat.“ Or as Milton Freeman said “Don’t cross a river when you are told the average depth is 4 feet”