19 Dec .32 Xr15-32 An investor who can correctly forecast
.32 Xr15-32 An investor who can correctly forecast thedirection and size of changes in foreign currencyexchange rates is able to reap huge profits in theinternational currency markets. A knowledgeablereader of theWall Street Journal (in particular, of thecurrency futures market quotations) can determinethe direction of change in various exchange ratesthat is predicted by all investors, viewed collectively.Predictions from216 investors, together withthe subsequent actual directions of change, wererecorded in the following way: Column 1: predictedchange where 1=positive and 2=negative;column 2: actual change where1=positive and2=negative.a. Can we infer at the 10% significance level thata relationship exists between the predicted andactual directions of change?b. To what extent would you make use of these pre-dictions in formulating your forecasts of futureexchange rate changes?