Model DesignSelection of model vari

Model Design
Selection of model variables and their dependencies
 The decision needs to include not only the selection
of the types of variable but also the logic flow of the
model, and the relationships between the variables.
 Think about…
 Sales = Volume multiplied by price
 Volume = Sales divided by price
 Price = Sales divided by volume
 Sensitivity analysis forces one to decide which
variable is independent (the model input) and which
is dependent