Microsoft Stock Project

Purpose: To show the increase in the market price for shares from the year 1990 to 2020 (Average Price).
Data: Information retrieved from ... https://www.macrotrends.net/stocks/charts/MSFT/microsoft/stock-price-history

Data Table: Prices shown of stock 1990 to 2020

Scatter Plot:
Data is consisted of stock slowly rising up throughout 3 decades. The data exhibit a slow start but
gradually grow towards the end of 2020.
Best fit Regression Line: y=0.0086X+20 : X is for Year, Y is for Stock Price (US Dollars)

The slope is 5.638 and is positive since the business is stable every year and the products of
Microsoft continue to sell.

Values of R^2 and R:

R^2 = 0.6526
The slope of the regression line is positive so the correlation of R is positive.
R= √0.6526 = 0.81
The line isn’t the best but covers the whole positive correlation. 0.81 is moderately strong since it is close to positive 1.

Prediction:
In the year 2015, substitute X = (2015) to get Y= 0.0086(2015)+20 ≈ 37.3

The regression line predicts the price for stock in 2015 for Microsoft is $37.30.

Narrative: The data shows Microsoft’s big accomplishment of increasing their stocks, starting off from just .86 cents a
share in 1990, then in 2020 made a big increase of $176.40 per share.

The regression line predicts in 2015 the stock price for one share is $37.30 which is about $9.41 less than the original
existing price of $46.71.

Can the Regression line prediction be accurate in the near future? The answer is no. Mainly because is a stock market.
Anything could happen. It goes up and down constantly and change the way holds shares. For instance, the Covid-19
pandemic or maybe the economy crashes losing all profits.

A note from 2015 to 2020 a big leap appears on the scatter graph that is way far from the regression line. The prediction
would be far from the existing 2020 stock price. It would’ve appeared as $37.37 in 2020 instead of $176.40

I find this project interesting, using what I learn from the past weeks and using it in real life to calculate the stock markets
for any shares. Then again it depends on the businesses out there with more constant growth. I’m sure using this
technique will help me get a better prediction on which stock I want to invest on for long term.