The Process of Generating Probabilistic Inputs and Computing the Value

question 5

Multiple Choice

The process of generating probabilistic inputs and computing the value of the output is called

• A)simulation.
• B)verification.
• C)validation.
• D)implementation.

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Definitions:

Investments

Assets or items acquired with the goal of generating income or appreciation over time.

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan balance.

Non-interest Bearing

A financial term indicating a debt or deposit that does not accrue interest over time, identical in concept to its prior mention but explained with different wording.

Compounded Monthly

A method of calculating interest where the interest earned each month is added to the principal, compounding the amount on which future interest is calculated.