Application of Monte Carlo Simulation for Analysis of Costs and Economic Risks in a Banking Agency

Silva, Saulo André; Abreu, Pedro Henrique Camargo de; Amorim, Fernando Rodrigues de; Santos, David Ferreira Lopes

doi:10.1109/tla.2019.8863311

Cited by 11 publications

(11 citation statements)

References 28 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Therefore, SMC 50000 simulations were performed based on the analysis of the average revenues minus the average production costs of sugarcane suppliers. The same number of interactions were performed by (Silva et al, 2019).…”

Section: Methodsmentioning

confidence: 99%

See 1 more Smart Citation

Costs of Agronomic Practices: Profitability at Different Scales of Sugarcane Production in Brazil

Patiño

Amorim

Andrade

et al. 2022

IJBA

Self Cite

View full text Add to dashboard Cite

The diversity in agronomic practices being used by sugarcane producers in Brazil determines differences in economic performance and cost structure. The purpose of this study is to evaluate the cost of six systems of agronomic practices using fixed or variable rates for soil amendment, fertilizer, and defensive applications and assess the profitability of these systems at three scales of sugarcane production. We then describe the data sample related to the 2019–2020 harvest season and collected from fifty-five sugarcane producers in the central-south region of Brazil. Thereafter, using a quantitative approach, a cost analysis was performed, and the cumulative frequency of the net revenue for the three scales of production (small, medium, and large), was calculated using a Monte Carlo simulation. The cost analysis indicated that fertilizer had the highest cost considering the agronomic practices adopted at the three scales of production analyzed. The cumulative frequency analysis results from the Monte Carlo simulation showed the highest net revenue per hectare for medium sugarcane producers. In addition, the presence of economies of scale was not confirmed because the lowest cost was found in small-scale sugarcane producers and the highest net revenue was obtained by medium-scale sugarcane producers.

show abstract

Section: Methodsmentioning

confidence: 99%

“…The number of repetitions in this distribution provides other values obtained from these variables, yielding new results and determining the likelihood of success or failure of a particular activity. This type of distribution has been used by (SILVA et al., 2019).…”

Section: Methodsmentioning

confidence: 99%

Costs of Agronomic Practices: Profitability at Different Scales of Sugarcane Production in Brazil

Patiño

Amorim

Andrade

et al. 2022

IJBA

Self Cite

View full text Add to dashboard Cite

show abstract

“…MCS uses models capable of generating possible results from a range of values, in the form of a probability distribution, in which there is inherent uncertainty. The lower and upper values used in the ranges are obtained from the standard deviation (obtained from the descriptive analysis of the simulated data), identifying the level of certainty of occurrence of the variable of interest (Silva et al, 2019;Abreu & Amorim, 2017).…”

Section: Monte Carlo Simulation (Mcs)mentioning

confidence: 99%

“…As it occurs under conditions of uncertainty, this activity requires tools, from decision-makers, to better assess which inputs to use in the production of sugarcane, ensuring lower cost and greater financial return. Thus, in addition to the ARIMA models, the Monte Carlo Simulation stands out as a viable tool to be used to measure the level of certainty of certain production costs relevant to the price of this crop (Silva et al, 2019), the which can be previously identified through regression models.…”

Section: Introductionmentioning

confidence: 99%

Effect of Production Costs on the Price per Ton of Sugarcane: The Case of Brazil

Oliveira

Amorim

Barbosa

et al. 2022

IJSSS

Self Cite

View full text Add to dashboard Cite

The costs of agricultural inputs added to those of labor represent almost a third of the total cost of Brazilian sugarcane production. This study analyzes the behavior of the price per ton of sugarcane in Brazil, relating it to the main production costs of this cultivation. Twelve price indicators from January 2015 to December 2020 were evaluated. First, the data were adjusted to a multiple linear regression model to identify the significant variables on variation in the price per ton of sugarcane. Then, the Monte Carlo simulation was used to measure the level of certainty of occurrence of these variables, and forecasts were obtained from the adjustment of ARIMA models. The results showed the influence of the costs of diesel oil, two agricultural pesticides, and daily laborers on the price of sugarcane, besides an increasing trend of its, providing relevant short-term projections for decision-making about investments in the agribusiness sector.

show abstract

“…Especially simulation Monte Carlo that has been used since the War II attracted a great deal of popularity. This approach is frequently used in the financial sector where it is applied for various economic analysis [10].…”

Section: Introductionmentioning

confidence: 99%

Management of business processes using stochastic simulation

2020

View full text Add to dashboard Cite

The paper deals with risks and uncertainties that are related to business processes. The risks and uncertainties (risk factors) can significantly influence organizational performance, value creation and long term-sustainability. Managers are often puzzled with making decisions in the environment of breakthrough discontinuities. The main outcome of the paper is the presentation of purposefully developed software tool that uses stochastic simulation of risks and uncertainties of business processes to support making optimum managerial decisions. This software is able to simulate any process risk factors that are describable by a mathematical model. The model was tested on the examples of production and investment cases. The research applied Business Process Modelling Notation Approach (BPMN) as well as mathematical and stochastic modelling. In addition, contextual interviews with company managers and risk specialists were used to get unbiased, reliable, and professional information on determination and analysis of process risk factors. The research was also supported by the evidence provided by the case study that illustrates software based decision-making process relating to opting for technology variant.

show abstract

Application of Monte Carlo Simulation for Analysis of Costs and Economic Risks in a Banking Agency

Cited by 11 publications

References 28 publications

Costs of Agronomic Practices: Profitability at Different Scales of Sugarcane Production in Brazil

Costs of Agronomic Practices: Profitability at Different Scales of Sugarcane Production in Brazil

Effect of Production Costs on the Price per Ton of Sugarcane: The Case of Brazil

Management of business processes using stochastic simulation

Contact Info

Product

Resources

About