Let the battle begin anew. We continue our journey in uncertainty modeling, having understood how to fit distributions to data using Crystal Ball (CB). How does that experience compare to what ModelRisk (MR) has to offer?
Open the Duke 09_10 Scores spreadsheet with ModelRisk loaded in the Excel environment. We will first create the MR Objects representing the fitted PDFs. (Just as with the CB exercise, it is good practice to examine a variety of best-fitting distributions, rather than blindly accepting the top dog.) Then, in distinctly separate cells, we will create the VoseSimulate functions that behave as sampled values from the PDFs modeled by the MR Objects.
As with Crystal Ball, ModelRisk has the ability to fit distributions to historical data. The analyst looking to describe the variation of a Monte Carlo Analysis input can use "fitting" windows to select data and manipulate other options. How does the ModelRisk (MR) fitting experience stack up against the Crystal Ball (CB) methods and options? There are some important differences one should understand about MR before fitting PDFs to the Duke 09_10 Scores spreadsheet.
Are there discrete univariate probability distribution functions (PDFs) that can be used to simulate college basketball scores? Do we, as avid basketball observers, know enough to suggest one discrete PDF is better than another? In fitting distributions to data in your business problems, the analyst will be asking the same types of questions. If the analyst is not an expert on the inputs and their behavior, he or she should seek out a subject-matter expert (SME) who can provide insight. Putting experience and theoretical knowledge together this way is a best practice for distribution selection.