How Does the Efficiency of Monte Carlo Compare to the Binomial Model for American Options?

For American options, the Binomial Model is often more efficient for options with short times to expiration, as it is a deterministic model. Monte Carlo, even with the Longstaff-Schwartz method, can be computationally more intensive due to the complexity of the regression at each time step.

However, Monte Carlo is more versatile for high-dimensional or complex path-dependent American options.