Chapter 13: Simulation and Bootstrapping Study Notes contains 13 pages covering the following learning objectives:

* Describe the basic steps to conduct a Monte Carlo simulation.

* Describe ways to reduce Monte Carlo sampling error.

* Explain the use of antithetic and control variates in reducing Monte Carlo sampling error.

* Describe the bootstrapping method and its advantage over Monte Carlo simulation.

* Describe the pseudo-random number generation method

* Describe situations where the bootstrapping method is ineffective.

* Describe the disadvantages of the simulation approach to financial problem solving.

After reviewing these notes on you will be able to apply what you learned with practice questions.

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