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Figure 14-7 illustrates the relationship between mortgage interest rates and the share of residential investment in GDP. Another way of looking at the same relationship is to take housing starts instead of the share of residential investment.

a. Go to http://research.stlouisfed.org/fred2 . Click on "Interest Rates," "30yr Mortgage," and download the series "MORTG" for 30-year conventional mortgage rates. Go to www.census.gov . Click on "Housing," then on "Construction" under "Related Sites for Housing Data." Next to "Housing Starts," choose the seasonally adjusted annual rate and download the data.

b. Using EXCEL, create a graph that includes both the mortgage interest rates and the housing starts. Visually, what is the relationship between these two variables?

Econometrics, Economics

  • Category:- Econometrics
  • Reference No.:- M91892885

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