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# Glossary

## algorithm assumption assumption cell probability distribution.

A rule that specifies how to solve a particular problem. An estimated value or input to a spreadsheet model. A value cell in a spreadsheet model that has been defined as a

base case The value in a Crystal Ball assumption, decision variable, or forecast cell at the start of a simulation. CDF Cumulative distribution function that represents the probability that a variable will fall at or below a given value. certainty bands each forecast. In a trend chart, a graphic depiction of a particular certainty range for

certainty level The percentage of values in the certainty range compared to the number of values in the entire range. certainty range on the forecast chart. The linear distance for the set of values between the certainty grabbers

coefficient of variability also coefficient of variance or coefficient of variation A measure of relative variation that relates the standard deviation to the mean. Results can be represented in percentages for comparison purposes. continuous probability distribution A probability distribution that describes a set of uninterrupted values over a range. In contrast to the discrete distribution, the continuous distribution assumes there is an infinite number of possible values. correlation In Crystal Ball, a dependency that exists between assumption cells. correlation coefficient A number between -1 and 1 that specifies mathematically the degree of positive or negative correlation between assumption cells. A correlation of 1 indicates a perfect positive correlation, minus 1 indicates a perfect negative correlation, and 0 indicates there is no correlation. cumulative frequency distribution A chart that shows the number or proportion (or percentage) of values less than or equal to a given amount. decision variable A Crystal Ball variable in your model that you can control. decision variable cell Cells that contain the values or variables that are within your control to change. The decision variable cells must contain simple numeric values, not formulas or text. deterministic model results. Another name for a spreadsheet model which yields single-valued

discrete probability distribution A probability distribution that describes distinct values, usually integers, with no intermediate values. In contrast, the continuous distribution assumes there is an infinite number of possible values. display range The linear distance for the set of values displayed on the forecast chart. dominant A relationship between distributions in which one distribution's values for all percentile levels are higher than another's. See also subordinate. entire range forecast value. The linear distance from the minimum forecast value to the maximum

forecast A statistical summary of the assumptions in a spreadsheet model, output graphically or numerically.

forecast cell Cells that contain formulas that refer to one or more assumption and decision variable cells and combine the values in the assumption, decision, and other cells to calculate a result. forecast definition dialog. forecast filtering a specified range. forecast formula The forecast name and parameters assigned to a cell in a Crystal Ball A process by which Crystal Ball discards forecast values outside or inside A formula that has been defined as a forecast cell.

forecast value also trial A value calculated by the forecast formula during an iteration. These values are kept in a list for each forecast, and are summarized graphically in the forecast chart and numerically in the descriptive statistics. formula cell A cell that contains a mathematical formula. The number of times a value recurs in a group interval. frequency also frequency count

frequency distribution A chart that graphically summarizes a list of values by sub-dividing them into groups and displaying their frequency counts. goodness-of-fit A set of mathematical tests performed to find the best fit between a standard probability distribution and a data set. grabber also certainty grabber or truncation grabber change values and settings. A control that lets you use the mouse to

group interval A subrange of a distribution that allows similar values to be grouped together and given a frequency count. iteration also trial A three-step process in which Crystal Ball generates random numbers for assumption cells, recalculates the spreadsheet model or models, and displays the results in a forecast chart. kurtosis The measure of the degree of peakedness of a curve. The higher the kurtosis, the closer the points of the curve lie to the mode of the curve. A normal distribution curve has a kurtosis of 3. Latin Hypercube sampling In Crystal Ball, a sampling method that divides an assumption's probability distribution into intervals of equal probability. The number of intervals corresponds to the Minimum Sample Size option available in the Run Preferences dialog. A random number is then generated for each interval. Compared with conventional Monte Carlo sampling, Latin Hypercube sampling is more precise because the entire range of the distribution is sampled in a more even, consistent manner. The increased accuracy of this method comes at the expense of added memory requirements to hold the full Latin Hypercube sample for each assumption. (See Setting Sampling Preferences.) mean The familiar arithmetic average of a set of numerical observations: the sum of the observations divided by the number of observations. mean standard error The Standard Deviation of the distribution of possible sample means. This statistic gives one indication of how accurate the simulation is. median The value midway (in terms of order) between the smallest possible value and the largest possible value. mode That value which, if it exists, occurs most often in a data set. model sensitivity The overall effect that a change in an assumption cell produces in a forecast cell. This effect is solely determined by the formulas in the spreadsheet model. Monte Carlo simulation A system which uses random numbers to measure the effects of uncertainty in a spreadsheet model. outliers also outlying values Values generated during a simulation on the extreme end of a distribution and are excluded from the display range. PDF Probability density function that represents the probability that an infinitely small variable interval will fall at a given value.

probabilistic model A system whose output is a distribution of possible values. In Crystal Ball, this system includes a spreadsheet model (containing mathematical relationships), probability distributions, and a mechanism for determining the combined effect of the probability distributions on the model's output (Monte Carlo simulation). probability (Classical Theory) The likelihood of an event. A set of all possible events and their associated probability distribution also distribution probabilities.

random number A mathematically selected value which is generated (by a formula or selected from a table) to conform to a probability distribution. random number generator A method implemented in a computer program that is capable of producing a series of independent, random numbers. range The difference between the largest and smallest values in a data set. rank correlation also Spearman's rank correlation A method whereby assumption values are replaced with their ranking from lowest value to highest value using the integers 1 to N prior to computing the correlation coefficient. This method allows the distribution types to be ignored when correlating assumptions. relative probability also relative frequency indicates probability when used in a proportion. A value, not necessarily between 0 and 1, that

reverse cumulative frequency distribution A chart that shows the number or proportion (or percentage) of values greater than or equal to a given amount. risk The uncertainty or variability in the outcome of some event or decision. seed value The first number in a sequence of random numbers. A given seed value produces the same sequence of random numbers every time you run a simulation. sensitivity The amount of uncertainty in a forecast cell that is a result of both the uncertainty (probability distribution) and model sensitivity of an assumption cell. sensitivity analysis assumption cells. skewed skewed, negatively range. skewed, positively range. The computation of a forecast cell's sensitivity with respect to the An asymmetrical distribution. A distribution in which most of the values occur at the upper end of the A distribution in which most of the values occur at the lower end of the

skewness The amount a curve differs from a normal, symmetrical distribution. The greater the degree of skewness, the more points of the curve lie to either side of the peak of the curve. A normal distribution curve, having no skewness, is symmetrical. Skewness is computed by finding the third moment about the mean and dividing by the cube of the standard deviation. spreadsheet model of relationships. Any spreadsheet that represents an actual or hypothetical system or set

standard deviation The square root of the variance for a distribution. A measurement of the variability of a distribution, i.e., the dispersion of values around the mean. (See formulas in "Standard deviation" in the "Statistical Definitions" chapter of the online Oracle Crystal Ball Statistical Guide.) subordinate A relationship between distributions in which one distribution's values for all percentile levels are lower than another's. See also dominant. trial also iteration A three-step process in which Oracle Crystal Ball, Fusion Edition generates random numbers for assumption cells, recalculates the spreadsheet model or models, and displays the results in a forecast chart. trial as used to describe a parameter in certain probability distributions times a given experiment is repeated. value cell variable referenced by a formula. A cell that contains a simple numeric value. A quantity that can assume any one of a set of values and is usually The number of

variance The square of the standard deviation; i.e., the average of the squares of the deviations of a number of observations from their mean value. Variance can also be defined as a measure of the dispersion, or spread, of a set of values about a mean. When values are close to the mean, the variance is small. When values are widely scattered about the mean, the variance is large. (See formulas in "Variance" in the "Statistical Definitions" chapter of the online Oracle Crystal Ball Statistical Guide.)