Simulations can be based on X's which are fixed in repeated sampling, X's drawn from a given distribution, or X's obtained via sampling with or without replacement from a given finite population. We use Excel's Linest function to compute OLS estimates. Test statistics are computed. Each repetition is one iteration in a Visual Basic loop. A histogram routine displays the results and computes sample statistics.
Text boxes give instructions and additional information.
Students' understanding can be assessed via homework and exam questions which ask them to vary the parameters of the Monte Carlo simulations and to interpret the resulting output. The workbooks can be used in labs or as homework files. Students can copy pictures of Monte Carlo output to separate documents. More advanced students can create their own Monte Carlo exercises.