Data Exploration - connect - CH 5 Understanding Risk For detailed instructions on using Federal Reserve
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Data Exploration - connect - CH 5 Understanding Risk
For detailed instructions on using Federal Reserve Economic Data (FRED) online to answer each of the following problems, visit www.mhhe.com/moneyandbanking6e and refer to FRED Resources and Data Exploration Hints.
- Plot the percent change from a year ago of the Wilshire 5000 stock index at a monthly frequency (FRED code: WILLS000PR). Visually, has the risk of the Wilshire 5000 index changed over time? (LO2)
- Another way to understand stock market risk is to examine how investors expect risk to evolve in the near future. The DJIA volatility index (FRED code: VXDCLS) is one such measure. Plot the level of this volatility index at a monthly frequency since October 1997 and, as a second line, the percent change from a year ago of the Wilshire 5000 index, also at a monthly frequency (FRED code: WILL5000PR). Compare their patterns. (LO2)
- For the period since 2005, plot on one graph the 30-year conventional mortgage rate (FRED code: MORTGAGEOUS) and a measure of an adjustable mortgage rate (FRED code: MORTGAGESUS). Explain their systematic relationship using Core Principle 2: Risk requires compensation. (LO2)
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Auditing and Assurance services an integrated approach
ISBN: 978-0132575959
14th Edition
Authors: Alvin a. arens, Randal j. elder, Mark s. Beasley
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