Skip to main content
Disciplines
Automotive Business IT + Informatics Construction + Real Estate Electrical Engineering + Electronics Energy + Sustainability Insurance + Risk Finance + Banking Management + Leadership Marketing + Sales Mechanical Engineering + Materials
Events
DE
EN
Books
Journals
Topic Page
Marketing
Start single access now
Access for companies
EXTENDED SEARCH
Log in
Top
Published in:
A Relief from Spreadsheet Misery Read chapter Read first chapter

2018 | OriginalPaper | Chapter

15. Building the Simulation in R

Author : Robert D. Brown III

Published in: Business Case Analysis with R

Publisher: Apress

Log in

Activate our intelligent search to find suitable subject content or patents.

search-config
loading …

Abstract

As for the solution approach, you want to calculate the VOI for the problem displayed in our last influence diagram. To do so, we take the following algorithm approach.

Dont have a licence yet? Then find out more about our products and how to get one now:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

inform now

Springer Professional "Technik"

Online-Abonnement

Mit Springer Professional "Technik" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 390 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Maschinenbau + Werkstoffe




 

Jetzt Wissensvorsprung sichern!

inform now

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

inform now
previous chapter A More Refined Explanation of VOI
Footnotes
1
The values you observe could vary due to the simulation error that arises from R’s simple Monte Carlo engine. Simple Monte Carlo can be somewhat “noisy.”
 
2
E.K. Godunova (originator), “Jensen inequality.” In Encyclopedia of Mathematics. http://www.encyclopediaofmath.org/index.php?title=Jensen_inequality&oldid=16975
 
3
Jensen’s inequality, stated as E(f( X ))) ≥ f(E( X )), demonstrates that it is not necessarily the case that the expected value of a function of descriptor variables X is equal to the function of the expected values of its descriptor variables. The equality holds true for linear systems of equations, but usually not for nonlinear ones. Our model has a nonlinearity in it due to the inclusion of the time value of money effects on the cash flow. The skewness in many of the underlying uncertainties compounds the problem of this distortion.
 
4
See, for example, Eric Almquist, John Senior, and Tom Springer, “Three Promises and Perils of Big Data,” Bain Brief, April 8, 2015: “Through 2017, 60% of Big Data projects will fail to go beyond piloting and experimentation and will be abandoned.” Although I can’t prove it here, I suspect that most of these failures occur for the same reasons all projects fail, the most frequent and pernicious one being the failure to properly frame the reason for the project anyway.
 
Metadata
Title
Building the Simulation in R
Author
Robert D. Brown III
Copyright Year
2018
Publisher
Apress
Book
Business Case Analysis with R

Print ISBN: 978-1-4842-3494-5

Electronic ISBN: 978-1-4842-3495-2

Copyright Year: 2018

DOI
https://doi.org/10.1007/978-1-4842-3495-2_15

Premium Partner

    Image Credits