The study whose results are presented here was carried out in support of an ongoing larger effort to investigate and understand the impact of coherence and polarization on the performance of instruments intended to monitor the Earth's radiant energy budget. The visibility of fringes produced by a Michelson interferometer is known to be sensitive to the degree to which the incident light beam is monochromatic. Therefore, the Michelson interferometer has significant potential as a tool for quantifying the degree of temporal coherence of a quasi-monochromatic light beam. Simulation of the performance of an optical instrument using the Monte-Carlo ray-trace (MCRT) method has been shown to be an efficient method for transferring knowledge of the coherence state of a beam of light from one instrument to another. The goal of the effort reported here is to create and experimentally validate an MCRT model for the optical performance of a Michelson interferometer. The effort is motivated by the need to consolidate the knowledge and skills of the investigator in the realm of physical optics, and by the need to make a useful analytical tool available to other investigators in the larger effort. / Master of Science / The purpose of this study is to investigate and understand the effects of coherence and polarization on the performance of instruments used to monitor and measure the Earth’s radiant energy budget. Coherence and polarization effects need to be understood because they have the potential to produce erroneous radiant energy budget data. Coherence is a measurable parameter describing the correlation between the electrical field phase of a single wave, or between several waves. Polarization is a measurable parameter that describes the orientation of the oscillating electric field of a propagating wave. One of the simplest ways to measure the effects of coherence and polarization is through the use of a Michelson Interferometer. Michelson Interferometers are sensitive machines that are able to produce interference patterns using a single beam of light. The clarity of the produced interference pattern is directly related to the amount of coherence and polarization present in the beam of light under examination. This is why a Michelson Interferometer is perfect for this application. A Michelson Interferometer created in a virtual workspace that utilized the Monte-Carlo ray-trace (MCRT) method has been shown to be an efficient method for transferring knowledge of the coherence state of a beam of light from one instrument to another. The Monte-Carlo ray-trace is an algorithm that facilitates the creation of virtual light rays that behave like natural light rays. The goal in using MCRT is to create and experimentally validate the level of accuracy of the virtual Michelson interferometer. The effort is motivated by the need to consolidate the knowledge and skills of the investigator in the realm of physical optics, and by the need to make a useful analytical tool available to other investigators in the larger effort.