About Me

In writing the "About Me" portion of this blog I thought about the purpose of the blog - namely, preventing the growth of Socialism & stopping the Death Of Democracy in the American Republic & returning her to the "liberty to abundance" stage of our history. One word descriptions of people's philosophies or purposes are quite often inadequate. I feel that I am "liberal" meaning that I am broad minded, independent, generous, hospitable, & magnanimous. Under these terms "liberal" is a perfectly good word that has been corrupted over the years to mean the person is a left-winger or as Mark Levin more accurately wrote in his book "Liberty & Tyranny" a "statist" - someone looking for government or state control of society. I am certainly not that & have dedicated the blog to fighting this. I believe that I find what I am when I consider whether or not I am a "conservative" & specifically when I ask what is it that I am trying to conserve? It is the libertarian principles that America was founded upon & originally followed. That is the Return To Excellence that this blog is named for & is all about.

Sunday, August 7, 2022

Pandemic Quiz

I was surprised how many people got the right answer to the DJIA quiz back in January.  One such surprise person, in the unlikely camp, told me "even though I am not good at math per se, due to my profession (real estate investing) I do understand finance math and the time value of money.  I even teach financial calculator and 'Time Value of Money" classes from time to time."

So let's up the ante.

Due to the pandemic many government & private company reports can show distorted year over year results when comparing a pandemic locked-down year like 2020 to a pre-pandemic year.  For instance a company's earnings report could look disastrous comparing 2020 results to those of 2019.  Both government & private companies solved this problem by comparing 2021 results to those of 2019 - i.e., comparison of two years ago rather than one.  See graph below that shows a smooth curve for "To two years prior" for the entire time frame shown & a similar curve for "To one year prior" except for the spike when comparing the results of 2020 to 2019.

  Click on graphic to enlarge

A second tactic involved taking data from 18 months or longer & displaying the data on an annual basis.

Our quiz involves a problem based on the second approach.

Pandemic Quiz

Due to the pandemic a certain index could not be determined at all after December, 2019 until the close of March, 2022.  The index had a reading of 10,000 on December 31, 2019 & 16,809 on March 31, 2022.  The institution responsible for the index likes to post the percent change of the index every January that represents the change for the past year determined from the end of December values of the index for the respective years.  The index follows the compound-interest law.  Based on the two index readings given above, what is the value of the index on December 31, 2020 & the percent change of the index from December 31, 2019?

No comments:

Post a Comment