Monte Carlo Technique (Monte Carlo Analysis or Monte Carlo Method) is a simulation technique using random sampling of variables in the approximate evaluation to obtain numerical results: optimisation, numerical integration, and a probability distribution. (Refer to the Monte Carlo Simulation (or Probability Simulation))
Reference Definition by Quantmleap.com: Monte Carlo Analysis involves determining the impact of the identified risks by running simulations to identify the range of possible outcomes for a number of scenarios. A random sampling is performed by using uncertain risk variable inputs to generate the range of outcomes with a confidence measure for each outcome. This is typically done by establishing a mathematical model and then running simulations using this model to estimate the impact of project risks. This technique helps in forecasting the likely outcome of an event and thereby helps in making informed project decisions.
Related Definitions in the Project: The Risk Management; Project Management
