There is provided a method for generating a probability distribution for a desired variable. A hyper parameter density function is provided, from which values are randomly selected. The selected hyper parameter value is used to compute an input variable value. A value is randomly selected from each input variable probability density function. These values are input into a physics model to compute an output value. This process is repeated to generate numerous output values, which are then used to construct an output value probability density function. After the output value probability density function is constructed, output value sensor data is obtained. The output density function is updated using the sensor data and a probabilistic evaluation of the hyper parameters. Improved predictions are iteratively made with the updated output distribution.