Plotting & Comparing FRED Data

In this assignment, you will examine the path of two interest rate series and identify any trends, changes, or correlations between the two economic data series. Using the same range of years you selected for your discussion in Module Two (i.e., a 10- to 15-year span over the last 50 years), you will plot and compare the federal funds rate with either the prime bank loan rate or the 30-year conventional mortgage rate using the Federal Reserve Economic Database (FRED).
To understand the relationship between the federal funds rate and the prime bank loan rate or the 30-year conventional mortgage rate, read the following analogy to a car’s brakes:
Suppose you bring your car to an auto repair shop because it does not stop in a safe manner when the brakes are applied. The mechanic explains that the car’s rotors are rusted out and the brake pads are gone, and that is why the car is not stopping as needed. In this analogy, the rotors and brake pads are the federal funds rate, and the braking performance of the car is the prime bank loan rate or the 30-year conventional mortgage rate.
Prompt: First, graph the monthly effective federal funds rates over your selected 10- to 15-year span.
6. Next, graph either the monthly prime bank loan rates or monthly 30-year conventional mortgage rate, again of your selected 10- to 15-year span, using the same instructions above.
7. After downloading the two graphs as images, insert them into a Word document along with a brief written analysis (described in the critical elements
below).
Specifically, the following critical elements must be addressed:
I. Interest Rate Graphs
A. Graph 1: Graph, download, and insert an image of the graph of the effective federal funds rates from the Federal Reserve Economic Database
(FRED) using the same time period (i.e., 10- to 15-year span over the last 50 years) you chose for the Module Two discussion response into a
Word document.
B. Graph 2: Graph, download, and insert an image of the graph of the prime bank loan rates or the 30-year conventional mortgage rate from FRED
using the same time period (i.e., 10- to 15-year span over the last 50 years) you chose for the Module Two discussion response into a Word document.
II. Analysis
A. Comparison: Analyze the two interest rates and explain how they have changed over your chosen time period, citing specific examples.
B. Causal Relationship: Briefly hypothesize the causal relationship between the two interest rates based on knowledge gained in the course. Cite
your sources.
GRAPHS ARE INCLUDED/ TIME PERIOD 2012-2022
Needed: 1 1/2 Pages of Written Analysis