The essay investigates the relationship between imports, foreign exchange, and inflation using ANOVA, correlation analysis, and the Kruskal-Wallis test. Here’s a summary of the findings and methods: **Introduction:** The study aims to assess how foreign exchange rates and inflation impact the total imports of goods and services across 175 countries for the year 2015. **Sample and Data:** The sample includes 175 countries. Data sources are the World Bank and other economic databases, focusing on imports, exchange rates, and inflation for 2015. **ANOVA Analysis:** 1. **One-way ANOVA:** - **Hypotheses:** - Null (H0): Means of imports are the same across different foreign exchange categories. - Alternative (HA): Means differ by foreign exchange category. - **Results:** Significant differences were found (p < 0.05), suggesting that import values vary with different foreign exchange rates. - **Homogeneity of Variances:** Violated, as indicated by Levene’s test (p < 0.05). - **Post Hoc Tests:** Games-Howell test showed significant differences between high and low foreign exchange categories. 2. **Two-way ANOVA:** - **Hypotheses:** - Null (H0): Means of imports are the same for all foreign exchange and inflation categories. - Alternative (HA): Means differ by both factors. - **Results:** Significant differences were found for foreign exchange (p < 0.05), inflation (p = 0.005), and their interaction (p = 0.022). **Bivariate Correlation Analysis:** - **Hypotheses:** - Null (H0): No significant correlation between imports and foreign exchange. - Alternative (H1): Significant correlation exists. - **Results:** A moderate negative correlation was found (r = -0.597, p < 0.01), indicating a significant but weak inverse relationship between imports and foreign exchange. **Kruskal-Wallis Test:** - **Hypotheses:** - Null (H0): Mean ranks for imports are the same across foreign exchange categories. - Alternative (H1): Mean ranks differ. - **Results:** Significant differences were found (p < 0.05), confirming the ANOVA results. The Kruskal-Wallis test is preferred due to data distribution issues. **Conclusion:** The analysis shows that both foreign exchange rates and inflation significantly impact import values. ANOVA and Kruskal-Wallis tests confirmed these findings, with Kruskal-Wallis being more suitable for the data due to non-normal distribution. (Essay Sample)

USING ANOVA, CORRELATION ANALYSIS AND KRUSKAL-WALLIS TEST TO DETERMINE THE RELATIONSHIP BETWEEN IMPORTS, FOREIGN EXCHANGE, AND INFLATION By Student’s Name Code + Course Name Professor’s Name University Name City, State Date 1 Introduction Global trade is an important aspect of our modern economy. It allows for the movement of goods and services from one part of the globe to the other. This, in turn, guarantees economic prosperity for a country. For a country to maintain a strong economy it needs to constantly have the ability to import goods (Anderson et al., 2014, p. 78). The goal of this report is to show the impact of foreign exchange and inflation on the number of imports into a country. * Sample Size The sample size is made up of a total of 175 countries. The countries are from the eight different planets on earth. This helps make the findings as accurate as possible (Galí, 2015, p. 36). * Dependent Variables The dependent variable in the collected data is the total imports of both goods and services into a country. This dependent variable is in US dollars. * Factors used Official Exchange rate The factor A which directly affects the dependent variable is the official exchange rates of different countries relative to the US dollar. The exchange rate in its simplest form is the value of a countries currency relative to that of another country. The exchange rate data used for the purposes of this research integrates GDP data to find out the true ability of a country to exchange its currency into that of another country. This Foreign Exchange data is presented in US dollars. Inflation rate Factor B, the other factor that affects importation is inflation. Inflation refers to a tendency for the price of goods and services to increase hence reducing the actual value of money. The inflation data used in this study is presented as a percentage of increase in consumer prices. * Sources and Period of Data used. Data on the number of goods and services imported by each country is retrieved from the World Bank Database. On the other hand, data on factors A and B are retrieved from the countries of the world database. The data on importation that is used in this analysis is that of the year 2015. 2015 was chosen because complete data on the factors under study for the year 2016, and 2017 were not available. (2) Analysis of Variance -ANOVA (I) One-way ANOVA * Dependent Variable and Factor A The goal is to test the null hypothesis that the dependent variable means are the same for all the categories in Factor A irrespective of the country. (i) Formulating the null and alternate hypothesis. HO: The means of the value of imports are the same for all the categories of foreign exchange irrespective of the country. HA: The means of the value of imported goods differ as per the different categories of foreign exchange. (ii) Statistical Decision using significant value (...