Why simulate?

Simulation is great because you can easily learn about other parameters of interest!

Remember P is the proportion of college women who think they are overweight.

Suppose you are interested instead in a probability interval for the odds ratio ($OR$), the ratio of the probability of "overweight" and the probability of "underweight":

$$ OR = \frac{P}{1-P} $$

Use simulation to summarize Harry's posterior density to learn about the odds ratio. (Recall that Harry's posterior for P is beta with parameters 19 and 7.)

Define the vector ab, the beta shape parameters for Harry's posterior.
Use the rbeta() function to simulate 1000 values from this beta curve. Store the values in p_sim.
Compute a vector or_sim of corresponding simulated values of the odds ratio.
Construct a histogram of the simulated odds ratios.
From the simulated values, compute the probability that the odds ratio is greater than 2.
Compute a 90% probability interval for the odds ratio.

Exercise

Why simulate?

Instructions