Statistics for Management and Economics
10th Edition
ISBN: 9781285425450
Author: Gerald Keller
Publisher: Cengage Learning
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Chapter 18.2, Problem 21E
a:
To determine
Creating indicators.
b:
To determine
Coefficient explanation.
c:
To determine
Testing the hypothesis.
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In this question, you will test relative purchasing parity (PPP) using the data. Use yearly
data from FRED website
from 1971 to 2020: (i) The Canadian Dollars to U.S. Dollar Spot
Exchange Rate (ER) (ii) Consumer price index for Canada (CAN_CPI), and (iii) Consumer price
index for the US (US_CPI). Inflation is measured by the consumer price index (CPI). The relative
PPP equation is:
AE CAN$/US$
ECAN$/US$
=
π CAN - πUS
Submit the Excel sheet that you worked on.
1. First, compute the percentage change in the exchange rate (left-hand side of the equation).
Caculate the variable for each year from 1972 to 2020 in Column E (named Change_ER) of
the Excel sheet. For example, for 1972, compute
E3: (B3-B2)/B2).
ER1972 ER1971
ER 1971
(in Excel, the formula in cell
not use ai please
8. The current price of 3M stock is $87 per share. The previous dividend paid was $5.96, and
the next dividend is $6.25, assuming a growth rate of 4.86% per year.
What is the forward (next 12 months) dividend yield?
Show at least two decimal places, as in x.xx%
%
Chapter 18 Solutions
Statistics for Management and Economics
Ch. 18.1 - Prob. 1ECh. 18.1 - Prob. 2ECh. 18.1 - Prob. 3ECh. 18.1 - Prob. 4ECh. 18.1 - Prob. 5ECh. 18.1 - Prob. 6ECh. 18.1 - Prob. 7ECh. 18.1 - Prob. 8ECh. 18.1 - Prob. 9ECh. 18.1 - Prob. 10E
Ch. 18.2 - Prob. 11ECh. 18.2 - Prob. 12ECh. 18.2 - Prob. 13ECh. 18.2 - Prob. 14ECh. 18.2 - Prob. 15ECh. 18.2 - Prob. 16ECh. 18.2 - Prob. 17ECh. 18.2 - Prob. 18ECh. 18.2 - Prob. 19ECh. 18.2 - Prob. 20ECh. 18.2 - Prob. 21ECh. 18.2 - Prob. 23ECh. 18.2 - Prob. 33ECh. 18.3 - Prob. 34ECh. 18.3 - Prob. 35ECh. 18.3 - Prob. 36ECh. 18.3 - Prob. 37ECh. 18.4 - Prob. 38ECh. 18.4 - Prob. 39ECh. 18.4 - Prob. 40ECh. 18.4 - Prob. 41ECh. 18.4 - Prob. 42ECh. 18 - Prob. 43CECh. 18 - Prob. 44CECh. 18 - Prob. 45CECh. 18 - Prob. 46CECh. 18 - Prob. 47CECh. 18 - Prob. 48CECh. 18 - Prob. 49CE
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