a) What is the correlation between annual inflation and annual gold returns? b) Do you think...

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a) What is the correlation between annual inflation and annual gold returns? b) Do you think gold is a good inflation hedge? Why or why not? Give a brief answer, but try to be quantitative in your answer. summary Q1 Q2 Question 1. Gold Annual inflation price Note: The annual inflation rate is rate 1968 38.69 1969 5.5% 1969 41.09 1970 5.7% 1970 35.94 1971 4.4% 1971 40.80 1972 3.2% 1972 58.16 1973 6.2% 1973 97.32 1974 11.0% 1974 159.26 1975 9.1% 1975 161.02 1976 5.8% 1976 124.84 1977 6.5% 1977 147.71 1978 7.6% 1978 193.22 1979 11.3% 1979 306.68 1980 13.5% 1980 612.56 1981 10.3% 1981 460.03 1982 6.2% 1982 375.67 1983 3.2% 1983 424.35 1984 4.3% 1984 360.48 1985 3.6% 1985 317.26 1986 1.9% 1986 367.66 1987 3.6% 1987 446.46 1988 4.1% 1988 436.94 1989 4.8% 1989 381.44 1990 5.4% 1990 383.51 1991 4.2% 1991 362.11 1992 3.0% 1992 343.82 1993 3.0% 1993 359.77 1994 2.6% 1994 384.00 1995 2.8% 1995 384.17 1996 3.0% 1996 387.77 1997 2.3% 1997 330.98 1998 1.6% 1998 294.24 1999 2.2% 1999 278.88 2000 3.4% 2000 279.11 2001 2.8% 2001 271.04 2002 1.6% 2002 309.73 2003 2.3% 2003 363.38 2004 2.7% 2004 409.72 2005 3.4% 2005 444.74 2006 3.2% 2006 603.46 2007 2.8% 2007 695.39 2008 3.8% 2008 871.96 2009 -0.4% 2009 972.35 2010 1.1% 2010 1370.00 2011 3.4% 2011 1531.00 2012 2.1% 2012 1664.00 2013 1.5% 2013 1205.20 a) What is the correlation between annual inflation and annual gold returns? b) Do you think gold is a good inflation hedge? Why or why not? Give a brief answer, but try to be quantitative in your answer. summary Q1 Q2 Question 1. Gold Annual inflation price Note: The annual inflation rate is rate 1968 38.69 1969 5.5% 1969 41.09 1970 5.7% 1970 35.94 1971 4.4% 1971 40.80 1972 3.2% 1972 58.16 1973 6.2% 1973 97.32 1974 11.0% 1974 159.26 1975 9.1% 1975 161.02 1976 5.8% 1976 124.84 1977 6.5% 1977 147.71 1978 7.6% 1978 193.22 1979 11.3% 1979 306.68 1980 13.5% 1980 612.56 1981 10.3% 1981 460.03 1982 6.2% 1982 375.67 1983 3.2% 1983 424.35 1984 4.3% 1984 360.48 1985 3.6% 1985 317.26 1986 1.9% 1986 367.66 1987 3.6% 1987 446.46 1988 4.1% 1988 436.94 1989 4.8% 1989 381.44 1990 5.4% 1990 383.51 1991 4.2% 1991 362.11 1992 3.0% 1992 343.82 1993 3.0% 1993 359.77 1994 2.6% 1994 384.00 1995 2.8% 1995 384.17 1996 3.0% 1996 387.77 1997 2.3% 1997 330.98 1998 1.6% 1998 294.24 1999 2.2% 1999 278.88 2000 3.4% 2000 279.11 2001 2.8% 2001 271.04 2002 1.6% 2002 309.73 2003 2.3% 2003 363.38 2004 2.7% 2004 409.72 2005 3.4% 2005 444.74 2006 3.2% 2006 603.46 2007 2.8% 2007 695.39 2008 3.8% 2008 871.96 2009 -0.4% 2009 972.35 2010 1.1% 2010 1370.00 2011 3.4% 2011 1531.00 2012 2.1% 2012 1664.00 2013 1.5% 2013 1205.20