(a) Make an Excel line graph of the exchange rate data. Describe the pattern.
(b) Click on the data and choose Add Trendline > Moving Average. Describe the effect of increasing m (e.g., m = 2, 4, 6, etc.). Include a copy of each graph with your answer.
(c) Discuss how this moving aver- age might help a currency speculator.

Transcribed Image Text:

Daily Dollar/Euro Exchange Rate for First 3 Months of 2005 (n 64 days) Date Rate Dat Date Rate Date Rate 3-Jan 1.3476 25-an .2954 -Fb 1.2994 10-Mar 13409 4-Jan 1.3295 26-an 1.3081 17-Feb 13083 11-Mar 1.3465 5-Jan 13292 27-Jan 1.3032 18-Feb 13075 14-Ma 1.3346 6-Jan 1.3187 28-Jan 1.3033 21-eb 13153 5-Ma .3315 7-Jan 1.3062 3-a .3049 22-Feb 1.3230 16-Mar 3423 10-Jan 1.3109 eb 1.3017 23-Feb 208 17-Mar 1.3373 11-Jan 1.316 2-Feb 1.3015 24Feb 1.3205 18-Mar 1.3311 12-an 1.328 3Feb 1.2959 25-Feb13195 21-Mar 1.3165 13-Jan 1.3207 4Feb 297 28-Feb 1.3274 22-Mar 1.3210 14-Jan 1.3106 7-Feb 1.2773 9 23-M 13005 17Jan 1.3075 8-Feb 1.2783 2-Ma 3127 24-Mar 1.2957 18-Jan 1.3043 9-Feb 12797 3-Ma 1.3130 25-Mar 1.2954 19-an 1.3036 10-Feb 12882 4-Mar 1.3244 28-Mar 12877 20-Jan 1.2959 1-eb 1.2864 7-Mar 1.3203 29-Mar 1.2913 21-Jan 1.3049 4e 298 8-Mar 13342 30-Mar 1.2944 24-Jan .304 15-Feb 1.2986 9-Mar 13384 31-Mar 1.2969 3 2 2