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CMA Intermediate · Operations Management and Strategic Management · Simulation and Line Balancing

Which of the following is a recognised limitation of simulation as a decision tool?

A recognised limitation is that simulation does not guarantee an optimal solution, and its results are only as good as the model and input data. It merely evaluates alternatives tested, so a faulty model or poor data leads to misleading conclusions.

  1. AIt does not guarantee an optimal solution and results depend on the quality of the model and input dataCorrect
  2. BIt cannot be used when the system has random variables
  3. CIt can only be applied after the real system has been built
  4. DIt gives results with certainty in a single run

Explanation

Simulation is descriptive: it shows how a modelled system behaves under given inputs, not what is optimal. Poor assumptions or data give misleading results, and it can be costly and time consuming. It is specifically suited to systems with random variables and to systems not yet built.

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