Disadvantages of simulation, Managerial Accounting

Disadvantages of Simulation

1) Although all models are simplification of reality, they may still be complex and require a substantial amount of managerial and technical time.

2) Practical simulation inevitably involves the use of computers which may be a handicap to firms without computer facilities or easy access to a computer.

3) Simulation don not produce optimal results. The manager makes the decision after testing a no. of alternative policies. There is always the possibility that the optimum policy is not chosen.

4) Simulation can be expensive in terms of design personnel, facilities e.g computers.

5) Each simulation model is unique and therefore cannot be generalized to other environments.

Posted Date: 12/7/2012 6:00:41 AM | Location : United States







Related Discussions:- Disadvantages of simulation, Assignment Help, Ask Question on Disadvantages of simulation, Get Answer, Expert's Help, Disadvantages of simulation Discussions

Write discussion on Disadvantages of simulation
Your posts are moderated
Related Questions

Difficulties in cost reduction 1) Resistance by employees to pressure to reduce cost usually because the nature and purpose of the campaign has not been properly explained to t

Identify the ways in which Total Productive Maintenance could be applied as part of a manufacturing organisation''s quality programme

Graphic Analysis Whenever you have two data points, you should generally suppose a linear relationship. When you acquire more data, you can study the data to determine when there

Let a quarry's cost function of producing Q tons of stone per hour be given by TC = Q 3 - 10Q 2 + 40Q + 25, so that marginal cost function is MC= 3Q 2 - 20Q + 40. (i) Find th

The Value Chain and Cost Analysis The behavior of a firm's costs and its relative cost position stem from the value activities the firm performs in competing in an industry. A me

What is period cost Period costs are those costs which are reported as expanses of the period in question. These are cost which are not assigned to the product but are charged

What the traffic can bear pricing Pricing based on what the traffic can bear is not a sophisticated method. It is used by retail traders as well as by some manufacturing firms.

Cash discount is given to buyers to bring them to make prompt payment. The credit terms identify the percentage discount and the period throughout which it is obtainable. Liberal c

The case of variable quantity discounts In practice, suppliers may offer different discounts for different quantities purchased. For illustration:    Segment        Quantity