1. What are some advantages of a Monte Carlo Simulation?

MARK ALL THAT APPLY

A. The algorithms it uses have never proven to be wrong.

B. It uses past performance to determine future activity, and since things go in a cycle its a good way to predict the future.

C. It automatically allocates the investors portfolio in low-priced Exchange Traded Funds (ETFs) in accordance with the optimal asset allocation model.

D. Its a very flexible system; its easy to change the parameters.

2. What are some disadvantages of a Monte Carlo Simulation?

MARK ALL THAT APPLY

A. It is designed for people who are financially middle class to use and is thus less useful for the upper class population.

B. It doesnt take into account behavioral finance theory.

C. It bases its information on past performance, and past performance is not a guarantee of future returns.

D. It is meant for professional financial planners to use and is not accessible to the general population.