A Research of the Interest Rate’s Role in the Tech Sector
DOI:
https://doi.org/10.54097/q6z46966Keywords:
High-tech industry; Interest rate; Time series analysis.Abstract
High-tech industry has always been the focus of the world. It not only accompanies the daily life but also plays an essential role in economy. In March 16th 2022, In response to looming inflation expectations, the Federal Reserve began raising interest rates. In order to observe the effect of raising rate on high-tech industry, this paper utilizes autoregressive integrated moving average (ARIMA) model to predict the short term value of the data set after the date of raising rate as if it never happens. ARIMA is one of the most popular model for analyzing time series data. It solely needs the historical data and utilizes the lagged moving average to smooth the time series data. By comparing the expected value and the real data, the impact of FED will be obvious. This paper tests the stereotype that raising rate could be destructive to an industry, and will only focuses on high-tech industry, more specifically, the telecommunication, Internet, and computer technology.
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