Consulting Case Interview Practice Questions

Answer: a, b, c and e - A Monte Carlo simulation relies on random sampling to simulate probablistic results.

Yes, you can use a Monte Carlo simulation to model stock returns, as well as cost, probability and project duration. It cannot, however, tell you anything about the quality of the inputs used to arrive at the results of the simulation.

Key Takeaway: Monte Carlo simulation is a highly robust tool for consultants. For instance, one Upward Mobility editor used it to model the probability that an airline would go bankrupt due to plane crashes with various insurance policies. You must be prepared for questions that ask you how you would analyze a situation. We’re trying to go beyond what your standard case consulting book would cover and suggest some techniques.