Why use computer models?
As well as financial modelling, A piece of software used to manipulate data, often used in modelling.The programs, applications and data in a computer system. Any parts of a computer system that aren't physical. can be used for many other kinds of computer model:
- modelling supermarket queues
- modelling the stresses which will be borne by a new bridge
- modelling traffic flow in a new road system
Computer models are cheaper to set up than alternative methods that could be used to predict what will happen in a system, eg building a prototype. Other benefits include being able to:
- make alterations and quickly see the outcomes
- repeat tests several times over
- learn from "what if?" scenarios
- model dangerous situations safely
Limitations of computer models
A model is only as good as the rules used to create it. A mistake could have been made by whoever wrote the model and not every situation might have been considered - both of these issues could cause the model to give incorrect answers.