Stochastic simulations
Problems encountered so far are completely determined by the models and will produce the same solutions repeatedly, even the chaotic strange attractor, given the same parametrization and initial conditions.
Some models have terms that occur randomly, and these are called stochastics.
We have already seen examples earlier of the price of a volatile stock. While the price increased roughly with the underlying price of money, fluctuations were considered to exist on a day-to-day process sampled from a Gaussian process. Time-series analysis is often used to reduce the effect of such fluctuations and reveal underlying trends, but there are certain systems where stochastics are paramount.
Typical examples are models of queueing systems that might occur in services at banks, or checkouts in supermarkets. I will discuss a particular case of a bank teller later in this section.
Simulations are often dealt with using a framework that attempts to hide the details...
