A computerized mathematical model that allows people to account for risk in quantitative analysis and decision-making. It runs thousands of trials with random variables to simulate a range of possible outcomes.

Instead of guessing a single number for an uncertain variable (like future sales), you define a range of possible values. The simulation then samples from this range thousands of times to produce a probability distribution of results.

It provides not just what could happen, but how likely each outcome is. This helps in quantifying risk, identifying opportunities, and making decisions with a much clearer view of the potential future.