The Method of Light Curve Simulations is a tool that has been applied to
X-ray monitoring observations of Active Galactic Nuclei (AGN) for the
characterization of the Power Density Spectrum (PDS) of temporal variability
and measurement of associated break frequencies (which appear to be an
important diagnostic for the mass of the black hole in these systems as well as
their accretion state). It relies on a model for the PDS that is fit to the
observed data. The determination of confidence regions on the fitted model
parameters is of particular importance, and we show how the Neyman construction
based on distributions of estimates may be implemented in the context of light
curve simulations. We believe that this procedure offers advantages over the
method used in earlier reports on PDS model fits, not least with respect to the
correspondence between the size of the confidence region and the precision with
which the data constrain the values of the model parameters. We plan to apply
the new procedure to existing RXTE and XMM observations of Seyfert I galaxies
as well as RXTE observations of the Seyfert II galaxy NGC 4945.Comment: 9 pages, 2 figures, accepted for publication in Ap