What are Monte Carlo simulations and when are they useful? After covering these foundational questions, you’ll learn how to perform simple simulations such as estimating the value of pi. You’ll also learn about resampling, a special type of Monte Carlo Simulation.
Now that you can run your own simple simulations, you’re ready to explore real-world application of Monte Carlo simulations across various industries. Then, you’ll dive into the heart of what makes a good simulation work: sampling from the correct probability distribution. You’ll learn about probability distributions for discrete, continuous, and multivariate random variables.
Once you’re comfortable with your choice of probability distribution, you’re ready to follow a principled Monte Carlo simulation workflow using a dataset of diabetes patient characteristics and outcomes. You will explore the data, perform a simulation, and generate summary statistics to communicate your simulation results.
Discover how to evaluate your Monte Carlo models and communicate the results with easy-to-read visualizations in Seaborn. Finally, use sensitivity analysis to understand how changes to model inputs will impact your results, and practice this concept by simulating how business profits are impacted by changes to sales and inflation!