Stochastic Process (Noun)
Meaning
A statistical process involving a number of random variables depending on a variable parameter (which is usually time).
Classification
Nouns denoting natural processes.
Examples
- A stochastic process is a sequence of random states, which can be described by a probability law, and evolves over time with each new state depending on the previous one.
- The stock market can be viewed as a stochastic process, where the current stock price depends on the previous price and other random factors.
- A simple example of a stochastic process is a random walk, where at each time step, the position moves randomly in one dimension.
- The solution of a stochastic differential equation can be viewed as a stochastic process, describing the uncertain evolution of some system over time.
- Many natural phenomena, such as population growth, gene mutations, or the spread of disease, can be modeled as stochastic processes, providing insights into their dynamic behavior.