OR 635

Discrete System Simulation

Fall 2010

Important Announcements & Deadlines

  • HW#5 is due at 7:20 PM, Tuesday, November 30.
  • Term project report is due at 7:20 PM, Tuesday, December 7.
  • Midterm Exam: In class on November 2. Make up exam questions will be MUCH MORE DIFFICULT than regular exam questions.
  • Reminder: there is a 20% penalty for the HW turned in through email.
  • Reminder: some announcements will be sent to your GMU email address. Please check your GMU emails routinely or ensure that they are forwarded correctly.
  • A good follow-on for this class is OR/SYST 735: Advanced Stochastic Simulation (will be offered in Spring 2011).

Instructor: Chun-Hung Chen
Email: cchen9@gmu.edu
Office: Engineering Building (Academic VI), Room 2213
Phone: 703-993-3572
Fax: 703-993-1521
Office Hours: Tuesday 4:30 - 6:00 PM

Teaching Assistant: Mr. Sameer Kulkarni
Email: skulkar2@gmu.edu
Office: SEOR TA Room (Engineering Building, Room 2216)
Office Hours: Monday 5:30 - 6:30 PM, and Tuesday 6:00 - 7:00 PM.

Course Description:

Examples of discrete-event systems are all around us: multiteller banks; computer networks; automated manufacturing systems; airport terminals; and traffic control systems. In order to efficiently manage and operate these systems, it is often necessary to apply simulation to study their performance since no closed-form analytical solutions exist for such problems. This course deals with this category of systems. Topics will include stochastic modeling, random number generators, discrete-event simulation approaches, simulated data analysis, and simulation variance reduction techniques. Simulation software packages are extensively used in this class. Each student is expected to produce successful simulations.

Prerequisites: OR 542, or STAT 346, or STAT 354, or equivalent, and one scientific programming language

Grading: Homework 35%; Midterm 30%; Term Project 35%.

Text 1: C. H. Chen and L. H. Lee, Stochastic Simulation Optimization: An Optimal Computing Budget Allocation, 2010. Please click here for details. You can order it from the university book store or Amazon.com.

Text 2: W. D. Kelton, R. P. Sadowski, and D. T. Sturrock, "Simulation With Arena," 5th Edition, 2010. You may have a question whether you need to buy this book. ARENA is the major simulation software used in this class. Since ARENA is very powerful, many earlier students used it to do their term projects. It is highly recommended that each project team buys at least one copy of this book. If you can not find the 5th Edition as suggested, the 2nd, 3rd, or 4th edition of this book is fine too. But the 1st Edition is too obsolete for this class.

Text 3: A. M. Law, "Simulation Modeling & Analysis," 4th Ed., 2007. (All earlier editions are fine)

Textbook Recommendation: There are three textbooks. It is understood that the books are expensive.

o   Text1 gives an introduction to simulation and focuses on the use of simulation for optimization. Text1 is also the required text for the advanced simulation class -- OR/SYST 735.

o   Text2 is an excellent user manual for current version of Arena, but may become obsolete in the future, or if you are not using Arena. It is recommended each project team buys a copy.

o   Text3 gives a comprehensive coverage on the simulation fundamentals.

ARENA Software: ARENA is the major simulation software used in this class. The education version of Arena is free of charge if you use it for class homework or term project. You can download the software at the Arena Book Web Site. Please read the instructions in the appendix of the book carefully before installation. If you have a Windows-based computer, you can install Arena on your own PC. In addition, Arena Version 12.0 is available at the IT&E PC Lab. Please note that Arena version up to version 11 is not supported on Windows Vista and click "Issues about Installing Arena at Windows Vista" for details.

Professional Version of ARENA: The student version of Arena is essentially the same as professional version except the limit on the size of model you can run. There are a row of PCs (#23 ~ 30) in IT&E Computer Lab (Room 1506 in the Nguyen Engineering Building) installed with professional version (version 12.0). The professional version allows you to run much bigger models.

In class, Tuesday, November 2. There is no final exam. Make up exam for certified medical reason only. Make up exam questions will be MUCH MORE DIFFICULT than regular exam questions.

General Rules:

  1. Late homework and term project report is always allowed. No need to get advanced permission. However, the penalty for late homework and term project report is 25% for the first day and then 5% per day. No exemption.
  2. Turning in HW through email is subject to a 20% penalty; but fax is OK.
  3. No collaborations are allowed for homework, although discussions are encouraged.
  4. Team work are encouraged for term project.
  5. Comments are strongly encouraged.
  6. No cheating.

Tentative Course Schedule & Reading Assignment:



Time (week)

Reading Assignment


Introduction and rationale


Text1: Appendix A.1


Basic event scheduling simulation


Text1: Appendix A.2 & A.3

Text3: Sections 1.1~1.4.3


Review of basic probability and statistics


Text1: Appendix B

Text3: Sections 4.1~4.2


Simulation Software


Text2: Chapters 3~ 4 (very useful!!)

Text3. Sections 3.1~3.3, Skim Sections 3.4~3.9.


Uniform random numbers


Text1: Appendix A.5

Text3: Sections 7.1~7.2, skim Section 7.3


Generating nonuniform random numbers


Text1: Appendix A.5

Text3: Sections 8.1~8.5


Input Modeling


Text1: Appendix A.5

Text2: Section 4.4

Text3: Skim Chapter 6


Simulation output analysis


Text1: Appendix A.6

Text3: Sections 9.1~9.4, skim Section 9.5


Monte Carlo Simulation


Text1: Chapter 1

Text3: Sections 1.8.3


Advanced Simulation Optimization


Text1: Chapters 1 & 2, Skim Chapter 3

Text3: Chapter 10


Term Project Presentation




Term Project: More details about term project will be given during the semester. Here are some reminders.

  1. Generally speaking, you can do any simulation related subjects. Simulated examples include Bank, elevators, restaurants, manufacturing plants, offices, traffic intersection, computer network, airports, railroad stations, barber shop, and party.
  2. You are strongly encouraged to do a simulation project which is relevant with your current work.
  3. Team work are encouraged. The idea size of a term project team is 2~3 members.

Homework Assignments & Others

Excel Add-In for Monte Carlo Simulation:

Crystal Ball and @RISK are two useful packages for Monte Carlo simulation using Excel. There are two excellent books for these tools:

  • Crystal Ball: "Introduction to Simulation and Risk Analysis" by J. R. Evans & D. L. Olson, Prentice Hall.
  • @RISK: "Simulation Modeling using @RISK", by W. L. Winston, Duxbury.

There is another add-in package called SimulaAr developed by Dr. Luciano Machain at National University of Rosario in Argentina. This is free and can be downloaded at

SimulAr Web Site (Free Excel add-in for Monte Carlo Simulation)

Useful information for HW#1:

In the HW#1, you need to implement simulation code for a two-node system. For your convenience, a version of the C-code for a simplified one-node system is provided below. In addition, the results by running this code is provided. You are supposed to obtain the same results on your own computation platform.

Useful Links to the Manufacturers of Simulation Software:

A good book for process modeling, simulation, analysis, and design:

The book "Process Analysis and Improvement" by M. S. Seppanen, S. Kumar, C. Chandra, McGraw-Hill, 2005, gives an excellent introduction about how to use four useful software tools altogether for process modeling, simulation, analysis and design:

1.      Microsoft Visio presents process logic as a visual diagram with necessary flows from one entity to the next.

2.      Excel is a repository of process data.

3.      Arena analyzes the process performance through simulation model.

4.      Visual Basic for Application can be used to move data between the above applications.

Other Useful Links:

  • A good follow-on for this class is OR/SYST 735: Advanced Stochastic Simulation.
  • A simulator for investment plan developed by T. Rowe Price. This simulator provides a whole new way to look at retirement income. It incorporates Monte Carlo simulation to show how uncertainty affects your planning for a steady lifetime income. A very good tutorial about the use of simulation for investment plan is offered at this web site.
  • Useful tools developed by Ben Crain at George Mason University for probability distributions and random number generation.
  • Informs Simulation Society a professional society for simulation.
  • Winter Simulation Conference, a main conference about simulation.
  • You can access the papers published in Winter Simulation Conference proceedings by clicking here.

Go to Professor Chun-Hung Chen's Page