A value-of-information based approach to simulation model refinement

The appropriateness of a simulation model for engineering design is dependent on the trade-off between model accuracy and the computational expense for its development and execution. Since no simulation model is perfect, any simulation model for a system's physical behaviour can be refined further, although likely at an increased computational cost. Hence, the question faced by a designer is ‘How much refinement of a simulation model is appropriate for a particular design problem?’ The simplified nature of simulation models results in two types of uncertainty – variability, which can be modelled using probability distribution functions and imprecision, best modelled using intervals.