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To this point our examples have assumed that the four random variables
are independent. Some problems are better described by mutually
exclusive scenarios. A scenario provides values for all random
variables, and the collection of scenarios shows all possible
vectors of random variables. To model a problem with scenarios
we click the Scenario button on the Add Function
dialog. For this option, Enumerate is the only analysis
method. The number of scenarios is entered to the right of the
button. Data concerning the random variables and functions are
entered on the left side of the dialog. Only the Number
of random variables is relevant for this model. |
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The form constructed by the add-in
for the scenario option is shown below. Note that the function
form in columns A through E does not show distributions. There
is only a single random variable that is the scenario index.
The Function part of the form is the same as for the
Enumerate form.
To the right of the function form is a list of the ten scenarios.
Each scenario shows the values of all four random variables.
Each has an index and a probability. The example has fictitious
data in columns I through L as provided by the built-in example.
We have modified the probability column (H) from the initial
values provided by the add-in. |
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To compute moments, select the Moments
command from the menu. The dialog allows only enumeration.
We have clicked the Display Results with the effect
illustrated below. |
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The add-in successively places each
scenario in the value row (Row 7) and the functions are evaluated.
The results are multiplied by the scenario probability. The contributions
from all the scenarios combine to compute the moment values shown
for the example in rows 11 and 12. Since all the scenarios are
considered, the moments are accurate. |
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With the Display Results option,
new columns are created for each function to the right of the
scenarios, columns M, N and O in this case. As the functions are
evaluated, the results are placed in the rows of these columns.
It is often useful to know the function values for each scenario. |
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Adding Scenarios |
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To add scenarios, select the last
row in the scenario table and choose Insert/Cells from
the Excel menu. Choose to shift cells down. |
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After the row or rows have been added,
fill in the data and renumber the indices. |
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Scenarios may be deleted by selecting
one or more rows in the table and choosing Delete. In
this case shift the cells up. |
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