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Modelling

P

peter

Member
In the course notes on Modelling one of the stages in developing a deterministic model is "choose the form of the model". This does not appear on the developing a stochastic model list. What does this relate to? The notes do not seem to give any further help. Is this Profit Testing / Pricing Model etc... If so then surely that relates to stochastic and deterministic? :confused:
 
Hi Peter

"Form of model" is a bit vague, I agree. I would guess it means deciding on whether the model:

- a single policy profit test model
- a new business model to work out profitability and capital requirements of writing new business
-an exiting busines model to work out profitability of existing business
- a full model office (new and existing business)
- an ALM

although, it could equally mean:

- a spreadsheet
- a full blown modelling package (Prophet, MoSes etc)

And you're dead right, it should probably include this on the stochastic model side. A year or so ago, we pushed the profession to make the two sets of steps consistent. This bit has slipped through the net. Thanks for raising it though.:)

Anna
 
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