Risk Management Professional Exam Prep

Answer: A, B, C and E - 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 project managers. We believe it is much more useful for modeling financial and risk outcome in probabilistic situations than project management.

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.