Economics and Statistics Insights
Explore macroeconomics, statistics, and Excel-based statistics analysis in this presentation covering topics like global business nature, inflation, hypothesis testing, regression analysis, and foreign inflation impacts on investments.
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Presentation Transcript
Omni Markets Investment, Inc. Student Coaching Slides 1
Concepts Covered Global nature of business and economics Macroeconomics - Introduction to macroeconomic variables - Interest rates & market of loanable funds - Money & inflation 2
Concepts Covered Statistics - Descriptive statistics - Hypothesis testing - Regression analysis - Variation & uncertainty 3
Questions 1, 2, and 3: Doing Statistics on Excel If you wish to review doing statistics on Excel, read the Using Excel for Statistics PowerPoint on the course web site. Use version appropriate for Excel 2003 or Excel 2007. The Excel data file for Omni Markets Investment, Inc. is also on the course web site. 4
Question 1: Hypothesis Tests Should you use a z, t, or p test? Look at the data and the sample size. Hint: No change is the null hypothesis. 5
Question 2: Scatter Plot From scatter plot, is there a relationship between changes in market indices and interest rates? As changes in interest rates increases, do changes in stock market indices appear to increase or decrease? What country, if any, is an outlier ? 6
Question 2: Regression Analysis R Square Coefficient of Determination percent variation in change in market indices (Y) accounted for by variation in change in interest rates (X) small value does not mean relationship is weak. Regression Coefficients - coefficient on X-variable measures the slope of the trend Line. (positive sign - positive relationship, negative sign negative relationship) p-Value is used to indicate the level of significance. 7
Question 3: Foreign Inflation & Return for U.S. Investor How will inflation in one country affect the value of that currency relative to other countries? (E.g. Will it take more or less yen to buy a dollar?) How would the adjusting exchange rate affect the apparent return to a U.S. investor? 8
Question 4: Macroeconomic Variables and Foreign Investments? All economies go through business cycles, periods of more and less rapid expansion or contraction in productivity. Some macroeconomic variables tend to increase earlier in the business cycle and are called leading indicators. Be sure to consider foreign government policies and stability. 9
Question 5: Should National Interest Rates be Considered? This is an open-ended question. Lots of good answers are possible. Be sure to consider statistical results and macroeconomic factors. 10
