Instructions-

Go to the Bureau of Economic Analysis web page (www.bea.gov). Under the heading labeled National, click on Gross Domestic Product. Under GDP, click on Interactive Tables... Click on Begin Using the Data. and then on Section 1 then on Table 1.1.1 Record the GDP data (first line) for the last 10 quarters. Make sure you record the value and the quarter corresponding to it. (e.g. I, II, etc.) The data you have are quarterly annualized growth rates for the economy over the last two and a half years.

Now go to Yahoo.com and click on Finance on the side. Click on the S&P 500 link. Under Quotes on the left, click on Historical Prices. In the Start Date box set the date to Jan 2 three years prior to this year then fill in the "Monthly" dot. Click Get Prices. Print your results.

Look at your GDP data gathered earlier. Note the quarter for your latest value (I, II, III, or IV). Quarter I ends on April 1 or 2, II ends on July 1 or 2, III ends on Oct. 1 or 2, and IV ends on Jan. 2 or 3. Select the S&P close index values for the ending months of the quarters corresponding to the GDP quarters. For example, if the last GDP value is for 2014 IV, the S&P value should be for Jan 2, 2015. The previous ending month is Oct 1 or 2, etc. Select the latest 11 end-of-quarter values for the S&P index starting with the end of quarter month before your first GDP value (July 1, 2012). Note that the web site data start with the latest month, rather than the earliest month.

Now calculate the quarter-to-quarter percentage changes in the S&P index (you will have 10 values). These values are quarterly growth rates for the stock market (as measured by the S&P index anyway) over the last year and a half. These rates are technically not directly comparable to the GDP rates, which are annualized, but they are ok for this case. Include the results along with the GDP growth rates in your report. It might be helpful to graph the GDP and S&P growth rates together.

Question-

1.) Analyze the data and draw conclusions about the relationship between the stock market and the performance of the economy.