Stochastic Modeling

Stochastic modeling is a mathematical method that involves random probability distributions or patterns that can be analyzed statistically but not predicted precisely. It contrasts with deterministic modeling by explicitly including elements of randomness and uncertainty. The approach uses probability theory to model phenomena with non-deterministic outcomes incorporating random variables stochastic processes and probability distributions to represent system uncertainty and variability over time.

Financial market analysis weather forecasting telecommunications traffic modeling inventory management systems and reliability engineering in complex systems.