From the course: Complete Guide to Generative AI for Data Analysis and Data Science

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Types of simulations

Types of simulations

From the course: Complete Guide to Generative AI for Data Analysis and Data Science

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Types of simulations

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- [Instructor] Now, there are different types of simulations. I want to go over a few of the most common kinds that are used in data analytics and data science. One is called Monte Carlo simulations, and in the Monte Carlo simulation, we are basically randomly sampling for some variables that we don't know, maybe have a range of values, so we're randomly sampling. And typically, it's a mix of variables, so we might have different variables, like with inventory, we have to think about how much demand there's going to be, how many people are going to be buying certain products, but we also have to factor in, how long does it take the suppliers to get us stuff? Maybe if there's a disruption in the supply chain, it might take 'em longer, so what are the range of possible values? Now, when we work with Monte Carlo simulations, we're going to be generating values using a probability distribution, so we might know from historical data, say, that the lead time that we need from when we order…

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