We are continually hearing reports on the nightly news about natural disasters—droughts in Texas, hurricanes in Florida, floods in California, and so on. We often hear that one of these was the “worst in over 30 years,” or some such statement. Are natural disasters getting worse these days, or does it just appear so? How might you use simulation to answer this question? Here is one possible approach. Imagine that there are N areas of the country (or the world) that tend to have, to some extent, various types of weather phenomena each year. For example, hurricanes are always a potential problem for Florida, and fires are always a potential problem in southern California.
You might model the severity of the problem for any area in any year by a normally distributed random number with mean 0 and standard deviation 1, where negative values are interpreted as good years and positive values are interpreted as bad years. Then you could simulate such values for all areas over a period of several years and keep track, say, of whether any of the areas have worse conditions in the current year than they have had in the past several years, where “several” could be 10, 20, 30, or any other number of years you want to test. What might you keep track of? How might you interpret your results?