TSTA602 Quantitative Methods for Accounting and Finance

Assignment Help Financial Accounting

Reference no: EM132504877

TSTA602 Quantitative Methods for Accounting and Finance - Top Education

Case Scenario. Bank X provides home loan service to their retail customers and charge a interest rate for their service. Due to market fluctuations, Bank X only offers floating interest rate (FIR) for their home loan customers. A friend of you who works as a banker at Bank X told you that the average yearly FIR in the last thirty years follows a Normal distribution with mean 3.2% (i.e., µ = 0.032) and standard deviation 0.04 (i.e., σ = 0.04). In addition, a sample of size 10 (drawn from N(0.032, 0.0016)) is available to you which has been summaried in the table below

-0.021 0.029 -0.009 -0.002 0.002 -0.006 0.006 -0.064 0.023 0.031

Table 1: A sample of FIR

Your friend seek help from you to use your knowledge from TSTA602 to assist Bank X to do the following data analysis. Please write a report to answer all the following questions.

Question (a). calculate (mannually) the sample mean, and sample standard de- viation for the sample in Table 1.

Question (b). if we draw samples of sizes 10 many times and form a distribution of sample mean, state the distribution of the sample mean and provide the reason for your conclusion; calculate the mean of the sample means and its standard deviation.

Question (c). based on (b), find the probability that the sample mean is smaller than 0.02. Please keep two decimal places in the calculation of standardization.

Question (d). if the sample mean from (a) is your observed value, calculate the 95% confidence interval for the sample mean.

Question (e). An outlier is a data point outside the interval [Q₁ - 1.5IQR, Q₃ + 1.5IQR], where Q₁and Q₃ are first and third quartile respectively, and IQR is the interquartile range. Explain whether there is any outlier appears in the sample in Table 1? You can calculate Q₁ and Q₃, and IQR using R (in Rstudio).

Question (f). Use R (in Rstudio) to generate 1,000,000 samples of size 10 from N(0.032, 0.0016) (please set the seed equals to 602), compute the sample mean for each of these samples, draw a histgram (set the frequency parameter to FALSE) for these sample means and add a density curve to the histgram. Please provide the histgram with the density curve here and attach your R code as appendix.

Reference no: EM132504877

Questions Cloud

Examine the use of current transportation economic : Examine the use of current transportation economic situations such as the 2010 BP oil spill in the Gulf of Mexico.

Why does the profit maximizing level of production occur : Why does the profit maximizing level of production occur at the point where marginal revenue equals marginal cost.

How much is Overhead Budget Variance : Monthly budgeted fixed overhead is $5,500. Revenues for the month were $50,100, How much is Overhead Budget Variance and Overhead Volume Variance

Describe steps to detect davids alleged industrial espionage : David Doe is a network administrator for the ABC Company. David is passed over for promotion three times. He is quite vocal in his dissatisfaction with this.

TSTA602 Quantitative Methods for Accounting and Finance : TSTA602 Quantitative Methods for Accounting and Finance Assignment Help and Solution, Top Education - Assessment Writing Service

Determine the estimated operating income : Determine the estimated operating income under each of the following scenarios. What is the budgeted operating income for Product A for the coming year

Describe the activations elevator pitch in a paragraph : Describe the activation's "elevator pitch" in a paragraph or so. Describe how you will connect with fans and what the goal of your activation is in a paragraph.

Maginal product of labour and maginal cost : What is the relationship between the maginal product of labour and maginal cost

Discuss problem based on hipaa compliance : HIPAA Compliance (Topic): Defend your choice of topic in 500 words or more. Include at least 3 expert supporting quotes surrounded by quotation marks and cited.

User Account

All Pages