final report foundation of business analytics

The goal of our team’s project is to study and mvestigate not only the inflation rates in Argentina and the US, but also the average GDP rate, the rate of environmental emissions, and th

THE UNIVERSITY OF DANANG VNUK INSTITUTE FOR RESEARCH AND EXECUTIVE EDUCATION

FINAL REPORT FOUNDATION OF BUSINESS ANALYTICS

VN-UK

Institute for Research

Danang, December 16, 2023 Lecturers: Mrs Tran Dinh Phương Ngôn

Strawberry Group

Nguyễn Hoàng Phương Quỳnh -22070004

& & Executive Education Education

7 Group Peer Evaluation

1, EXECUTIVE SUMMARY (Bao Uyen)

Inflation is the continuous increase in the general price level of goods and services over time and the loss of value of money, making life more difficult in a place where inflation occurs Inflation is a measure of the decrease in purchasing power per unit of currency that occurs when the general price level rises because a unit of currency can now purchase fewer products and services than it could previously This is a painful problem for every country during the recent global economic recession

The goal of our team’s project is to study and mvestigate not only the inflation rates in Argentina and the US, but also the average GDP rate, the rate of environmental emissions, and the rate of unemployment Additionally, we will examine several economic recovery imitiatives for both Argentina and the US from 1961 to 2021 in this investigation

We have researched and collected information and data at Work Bank Open To analyze the connection and impact of many economic factors on the overall economy through detailed analysis of data collected from the United States and Argentina from 1961 to 2021 Our team used the measures that include GDP (Current US$), GDP growth (annual %), Inflation (%), Unemployment (%), Foreign Direct Investment (FDD, population growth (annual %), and Global Recession during over 60 years

Our team plans to collect information about the project Step 1: Data requirements

Step 2: Collect data from trustworthy sources Step 3: Process and organize the collected data Step 4: Filter out and process irrelevant, incomplete, and missing data Step 5: Start analyzing the data using a variety of statistical methods and analytical methods Step 6: Make conclusions clearly and verify after analysis

2 DATA COLLECTION AND BACKGROUND WRITING (Annie) The data has been collected from a reliable and trustworthy source, namely the World Bank Open Data The countries chosen for this study are Argentina and the USA and we gather the important economic data from 1961 to 2021 The process involves sorting and organizing the data into a format appropriate for further analysis We will then investigate the correlations and patterns within the data using a variety of statistical approaches and analytical methodologies

We will analyze a set of economic measures from 1961 to 2021 for Argentina and the USA These measures include GDP (Current US$), GDP Growth (annual %), Inflation, Total Unemployment (% of the total labor force), Foreign Direct Investment (FDI), Population Growth (annual %), and Global Recession We aim to identify the determinants that impact the inflation rate m these two countries Moreover, sharing the results is extremely important because it helps us understand and discuss the data, and make decisions based on the valuable insights we gain from it

We aim to examine how various economic factors interrelate and influence the overall economy By conducting a thorough analysis of data gathered from the two countries, such as the USA and Argentina,

Executive Education

we can understand the correlation and impact of these factors For instance, both countries faced a global recession in 1991 and 2000 simultaneously A variety of data analysis techniques were used to examine the data and produce insightful conclusions Using Statistics, Word, and Microsoft Excel, they included interval estimates, regression analysis, tabular and graphical analysis, hypothesis testing, and forecasting These software programs and analytical tools were used to enable thorough data analysis and produce trustworthy findings from the dataset

3 LITERATURE REVIEW (Annie) The purpose of this literature review 1s to investigate previous studies and research that examine the correlation between various economic indicators, including GDP growth, Inflation, Unemployment, Foreign direct investment, and Population growth The analysis focuses on the economies of the USA and Argentina, utilizing data from the World Bank spanning the period from 1961 to 2021

Several studies have investigated the relationship between Unemployment and other economic variables We found a research paper from Google Scholar, the case study called Patterns of Macroeconomic Indicators Preceding the Unemployment Rise in Western Europe and the USA The objective of this investigation is to explore the phenomenon of a sudden and significant rise in the unemployment rate known as the "fast acceleration of unemployment" (FAU) that would happen after some time According to Tretina, K (2022), there is an inverse relationship between inflation and unemployment, indicating that when inflation rates are high, unemployment tends to be low Additionally, economic studies have shown significant interest in examining Foreign Direct Investment (FDI)

Moreover, due to environmental concerns, the relationship between population growth has garnered considerable attention Based on data from the World Bank, the population of the United States in 2021 was approximately 336,997,624 This represents a 0.31% increase compared to the population in 2020 Also, the population of Argentina in 2021 was approximately 45,276,780 This indicates a 0.53% increase compared to the population in 2020 It's worth noting that population growth rates can vary due to factors such as birth rates, death rates, immigration, and emigration Through the analysis, it can be seen that by examining the relationship between these economic indicators, this literature review aims to provide valuable insights into the economic dynamics and trends of both the USA and Argentina over the given period Nevertheless, further research is necessary to comprehensively understand the connections

between population growth, their implications for economic growth, sustainable development, and the formulation of effective policies in both countries during the period from 1961 to 2021

4 DATA ANALYSIS 4.1, Descriptive Statistics: (Phuong Quynh) Descriptive statistics is a means of describing features of a data set by generating summaries about data samples These descriptive statistics provide msight mto the data set and each of these represents a different value

Median Mode Standard Deviation Sample Variance Kurtosis Skewness Range Minimum Maximum Sum Count

82.86385295 31.04983682 5.519335648 #N/A 342.9566572 117619.2687 55.39701919 7.147749375 3049.652248 -3.561095576 3046.091152 10109.39006 122

& Executive Education Executive Education

® Kurtosis: 55.39701919 @ Skewness: 7147749375 @ Rangc: 3049652248 @ Minimum: -3.561095576 @ Maximum: 3046.091152 @ Sum: 10109.39006 e Count: 122 These descriptive statistics provide insights into the dataset The mean represents the average value, while the median represents the middle value The standard deviation indicates the dispersion of the data around the mean The minimum and maximum values represent the range of the data The count represents the number of data poimts analyzed Additionally, kurtosis and skewness measure the shape of the distribution

Inflation Rate Comparison between Argentina and United States

The provided preliminary descriptive analysis aims to compare the inflation rates between Argentina and the United States from 1961 to 2021 Inflation rates are measured using the GDP deflator, which is calculated by dividing nominal GDP by the GDP deflator

The inflation rate in Argentina has been relatively stable over the past few decades In contrast, the inflation rate in Argentina has been much more volatile, with significant fluctuations throughout the period In 1961, the inflation rate in the USA was around 15%, while in 2021 it reached a high of around

60% Argentina has had an average annual inflation rate of around 3%, while the United States's inflation rate has been above 10% on average, with some fluctuations This indicates that the inflation rate in the USA has been much higher than in Argentina during this period

4,2, Interval Estimation: (Phuong Quynh Found 6 data tables for both countries from 90%, 95%, and 99% confidence levels, then compared the data obtained from those 6 tables to draw out the characteristics of each country’s data

ARGENTINA Inflation GDP deflator Inflation GDP deflator Inflation GDP deflator

Standard Error 60.64248384 Standard Error 60.64248384 Standard Error 60.64248384

Standard Deviation 473,6329398 Standard Deviation 473,6329398 Standard Deviation 473,6329398 Sample Variance 224328.1616 Sample Variance 224328,1616 Sample Variance 224328,1616

Skewness 5044474069 Skewness 5 044474069 — Skewness 5 044474069

Maximum 3046.091152 Maximum 3046.091152 Maximum 3046,091152

Confid Level(99,0%) 1613261706 Conñd Level(90,0%) 101,3122968 Confid Level(95,0%) 121,3030283

UNITED STATES Inflation GDP deflator Inflation GDP deflator Inflation GDP deflator

Standard Error 0,289471918 — Standard Error 0,289471918 — Standard Error 0,289471918

Standard Deviation 2.260847951 Standard Deviation 2.260847951 Standard Deviation 2,260847951

Sample Variance 5,111433458 Sample Variance $,11143345§ Sample Variance Š,11143345§

Skewness 1364498745 Skewness 1364498745 Skewness 1,364498745

Confidence 99.09) 0,77007723 Confidence 0%) 0,483605931 Confidence 5.0%) 0,579030046

& & Executive Education Education

According to the two data tables we analyzed above, we see that the data from Argentina are less consistent than those from the US, suggesting that the values are more widely distributed The confidence intervals display the range that the population means is most likely to fall within Argentina's estimations may have slightly more uncertainty since its intervals at each confidence level have a little larger range than the United States

In both countries, positive skewness suggests a right-tail distribution Argentina is more skewed to the right than the US, as indicated by its higher skewness rating Additionally, the two nations exhibit positive kurtosis; but, when compared to the US, Argentina has a greater kurtosis, suggesting a bigger tail and perhaps more exceptions

When compared to the US, Argentina has a greater reach and a higher most extreme worth, suggesting a wider distribution and the presence of higher quality in the dataset

The mean values in Argentina are often greater than those in the US, as is the standard deviation Not only that, but the data also indicates that Argentina has higher variability, stronger skewness and kurtosis, and possibly more outliers

4.3 Hypothesis Testing (Kate) Argentina

t-Test: Two-Sample Assuming Equal Variances

hypothesis (HO) states that the mean inflation change rate in Argentina is 5% Using the SPSS program, we were able to establish the p-value, which is 0.03 This number is more than 0.05 Strong evidence exists to refute H1 As a result, we may reject the null hypothesis and accept the alternative hypothesis Additionally, it has been shown that Argentina's Inflation Change Rate is at an average pace of more than 157%, with a mean variation of around 5%

t-Test: Two-Sample Assuming Equal Variances

Inflation GDP deflator (annual %)

The alternative hypothesis (H1) is that it differs from 1,7% (3,31%), which is the null hypothesis (HO) that the mean Inflation Change Rate in the US is 5% Using the SPSS software, we find the p-value is 1,2, which is more than 0.05 This indicates that further data is required for a more thorough understanding and evaluation, as the Inflation Change Rate data does not demonstrate the necessary statistics to refute the null hypothesis

4.4, Regression Models ARGENTINA Gi) Literature review for the foundation of the model Scatter Plot

& Executive Education Executive Education

Correlation between Inflation Rate and GDP Growth

3500

3000 2500

0 -e€9-99669oooc0&6o0e©eocoeceẲeeceedeooeeooeodood9906029490406.49499.0.0.6©.0.0.060œ62660.60.0.6694.66 ọ 10 20 30 40 50 60 70

-500

10

7E+11 6E+11 SE+11 4E+11 3E+11 2E+11 1E+11

~1E+11 -2E+11

eet eeorer®

Correlation between Inflation Rate and FD]

eoosces Ä{eeceeeeeeeeeeeeeeeee Seo eee6ee6§66§6©6§5§

11

& Executive Education Executive Education

Correlation between Inflation Rate and Population Rate

(ii) The model presentation (Kate) Inflation Rate = 635,65 + (-7,95) *GDP + (-23,20) *GDP growth + (26,84)*FDI + (-57,06) *Unemployment rate + (-200,20) *Population growth + 22,25 *Global recessions

eres fom Suances le R

R Square Adjusted R Square Standard Enor Obscr ati ANOVA,

GDE Growih 23.2007838 s 19.96110943 „ -3.117466663 quy 0/038841294 l -19.19548906 -1.23498254 : -49.18548506 : 123408254 : (annual %)

Uneeployment, tout (% of tou labor fowe) (modeled ILO 67 96.9696 | 36.1393743 1496162356 69.14043345? 133.9215377 19.40314549 133.9179377 19.40214549 cainueei

09 36.84441494 55.17328041 0.484785457 04429789314 84.17337801 137.8623019 84.17337301 131.8621019

0,62 of the Foreign Direct Investment, Net Inflows (%) -> greater than 0,05 -> means insignificant 0,64 of the Population Growth (annual %) -> greater than 0,05 -> means insignificant

12