Setting Up a Probability Distribution, Building a Cumulative Probability Distribution

question 86

Multiple Choice

Setting up a probability distribution, building a cumulative probability distribution, and generating random numbers are

• A) necessary when the underlying probability distribution is normal
• B) three of the five steps in Monte Carlo analysis
• C) elements of physical simulation but not mathematical simulation
• D) the three steps involved in simulating a queuing problem
• E) advantages of simulation

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Definitions:

Direct Method

A way to prepare the cash flow statement where actual cash flow information from company’s operations segment is used.

Operating Expenses

Expenses incurred in the normal course of business operations, excluding costs of goods sold and depreciation.

Prepaid Expenses

Costs paid for in advance for goods or services to be received or used in the future, recorded as assets and subsequently expensed over the applicable period.

Indirect Method

A method used in cash flow statements to calculate net cash flow from operating activities by adjusting net income for non-cash transactions.