Which of the Following Statements About Simulation Is FALSE

question 79

Multiple Choice

Which of the following statements about simulation is FALSE?

• A)Simulation can be used to study the behavior of a system without the expensive alternative of actually building it.
• B)Many real-world complex problems that do not lend themselves to analysis using mathematical models can be studied using simulation.
• C)Simulation results are generally less accurate than analytical models.
• D)Simulation models do not make restrictive assumptions that typically do not hold in real-world scenarios.

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Definitions:

Informationally Efficient

The concept where a market is said to be informationally efficient if all relevant information is fully and immediately reflected in a security's market price.

Allocationally Efficient

Refers to a market scenario where resources are distributed in a way that maximizes the benefits to all participants, considering their preferences and needs.

Random Walk

A theory suggesting that stock market prices evolve according to a random path, making it impossible to consistently predict future movements based on past trends.

Stock Price Changes

Variations in the market price of a company’s stock over time.