# MIS445 Critical thinking 5

R is a free statistical software that is frequently and widely used. Go to R-Project for Statistical Computing (Links to an external site.)Links to an external site. to download the R software to your computer (follow the instructions provided in the attached R Installation Instructions sheet). The R Project website (Links to an external site.)Links to an external site. provides a brief introduction to R that you may also want to review.

n this CT assignment, we will use R software to analyze a dataset .

It contains daily closing stock prices for Google and Amazon from 8/22/2017 to 8/22/2018. When we examine stock prices (or other financial assets) we often transform them into a (simple) return series. The return series are computed by the formula: (present price/past price) – 1. The dataset contains both stock prices and return series.

1. Using R, construct time series (line) plots for both stock prices and return series. R functions ts.plot or plot can create the plot. Describe the patterns and compare the plots.
2. Based on the return series, can we claim that the mean Amazon return series is higher than that of Google?

a. What would be an appropriate test of the claim above? Explain.
b. Write the null and alternative hypotheses.
c. Using R, perform the test.
d. Write the decision in the problem context.

Take the screenshots of the R graphs and output as well as the code. Paste them into a Word document along with your answers to the questions above. Clearly label the questions and answers. Submit the Word file in Canvas.