1. Lessons Learned Discover 101 -D Theresia Wansi 1/08/09

2. Outline Discuss Projects Lessons learned

3. Two Projects 1.Tracking the Stock Market Performance 2.Research Methodology - investigate relationships between variables.

4. Who Is Dow Jones???

5. How is the Performance of the Stock Market? Monitor 3 main Indexes: –Dow Jones – S&P500 – Nasdaq

6. Main Web site for data used is: www.yahoofinance.com The attached excel file is the six weeks summary from Michael Quick, a student in the class.

7. Lessons Learned Good project if done for a short time. Boring if done all through the semester.

8. Solution Limit project to Two Months Have groups track different indexes and discuss results.

9. Econometric methodology Exploring Relationship between Variables Bobbie C., Mike S., Casey T.

10. Econometric Methodology –Define Research Question –Observe /gather Facts –Formula : y = b1 + b2 (x) + e –Estimate Parameters using Regression Analysis –Test Hypothesis –Use information to predict future outcomes

11. Step 1 : Define Question How is GPA affected by the amount of study hours?

12. Estimating Parameters by Bobbie C., Mike S., Casey T Regression Statistics Multiple R0.987 R Square0.975 Adjusted R Square0.974 Standard Error0.124 Observations19.000 ANOVA dfSSMSF Significanc e F Regression1.00010.152 665.26 40.000 Residual17.0000.2590.015 Total18.00010.412 Coefficients Standard Errort StatP-valueLower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept1.6010.059 27.35 60.0001.4771.7241.4771.724 Study Hours (slope)0.1220.005 25.79 30.0000.1120.1320.1120.132

13. The Meaning of the Output by Bobbie C., Mike S., Casey T B1: The Intercept –This number is the LOWEST possible GPA If Study Hours were zero B2: The Slope –This number represents by how much your GPA will increase for each hour you study. So the lowest possible GPA is 1.601 and for each hour you study, your GPA will increase by.122 Intercept:1.601 Study Hours (slope):0.122

14. Step 5: Using information to predict future outcomes by Bobbie C., Mike S., Casey T GPA = 1.601(b1) + 1.222(b2) * study hours B1:B2:Study Hours:GPA: 1.6010.12201.60 1.6010.122102.82 1.6010.122204.04 1.6010.122305.25 1.6010.122406.47

15. Lessons Learned KIS = Keep It Simple. –Explore simple relationships E.g Price & Quantity Demanded Income versus Expenditure –Omit Hypothesis Testing Too much for freshmen Include primary data from MM students. Having a Mentor in your field is helpful.

16. Questions???