Part 2. MM4XL Tools > 1. Strategic Tools > Risk Analyst > 4. Functions > 3. Distribution Functions > mmCHI2(Degrees)

Risk Analyst

mmCHI2(Degrees)

Example

=mmCHI2(5) can equal 1.313942432

Application

This distribution is used to calculate the probability that one of two mutually exclusive outcomes will occur. It may help, for instance, to calculate the number of smokers versus non smokers. It is modeled using one parameter only, the degrees of freedom. The larger the number of degrees, the more the Chi2 distribution resembles the Normal one.

How to use

This function returns the amount of mutually exclusive events. Say that we are modeling the employment of a new professor for an MBA course and we need an estimate of the experience, in years, of use of the PC. We expect it to range between zero and 15 years. The formula below may be used to estimate the years of experience for each candidate:

=mmCHI(2)

Copy the formula above in 100 cells. You will find that most simulated values will range between 0 and 15, with 50% of the values being less than 1.4 years. Not really an unmatchable expectation.

Technical profile

Type Continuous distribution.
Syntax =mmCHI2(Degrees)
Domain  Monte Carlo Simulation Software: Management Process Risk Analysis.
Mode If Degrees is less then 2 than = 0
Otherwise = Degrees - 2
Parameters Degrees is the number of degrees of freedom.
Remarks If Degrees is nonnumeric mmCHI2 returns the #VALUE! error value.
If Degrees is not an integer it is truncated.
If Degrees < 1 returns the #NUM! error value.
If Degrees > 680 then mmCHI2 approximates the value.
Relationships It is related to the Gamma, Normal, Poisson and to the Students t variates.
Graphs
mmCHI2(5) mmCHI2(100)
 Monte Carlo Simulation Software: Management Process Risk Analysis  Monte Carlo Simulation Software: Management Process Risk Analysis
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