How can we change the password of existing mybb database, and where do we need to modify to make the database work with mybb?
Changing the actual password is something you'll do in your host control panel somewhere, but to make it work with MyBB you'll need to edit ./inc/config.php.
for mysql (most common) you dont actually change the password for the database, you change the password for a mysql user account that has permissions to a specific mysql database.