Expenditure 100 200 300 400 600 500 700 900 800 0 1950 1952 1955 1957 1960 1962 1965 1967 1970 1972 1975 1977 1980 Expenditure from 1950-2020 1982 Time(years) 1985 1987 1990 1992 1995 1997 2000 2002 2005 2007 2010 2012 2015 2017 2020Expenditure in log (Thousands) 0.2 0.4 0.8 1950 1952 1955 1957 1960 1962 1965 1967 1970 1972 1975 1977 1980 Log-scale of Expenditure from 1950-2020 1982 Time (years) 1985 1987 1990 1992 1995 1997 2000 2002 2005 2007 2010 2012 2015 2017 2020\fExpenditure in log (Thousands) 0.2 0.4 0.8 1950 1952 - 1955 1957 1960 - - Linear Trend 1962 1965 Quadratic Trend Log (original series) 1967 1970 1972 1975 1977 1980 Expenditure Trend from 1950-2020 1982 Time (years) 1985 1987 1990 1992 1995 1997 2000 2002 2005 2007 2010 2012 2015 2017 2020Expenditure (Thousands) 1000 500 900 200 800 100 400 600 700 300 0 1950 1952 1954 1956 1958 1960 1962 Linear Trend Original Series Quadratic Trend 1964 1966 1968 1970 1972 1974 1976 1978 1980 Consumption Expenditure 1950 to 2020 1982 1984 Time(years) 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020ECON 102: FIRST ASSIGNMENT For this assignment, create a PDF with your preferred text processor and insert your charts and discussion when needed. Upload the file to the Learn Dropbox before it closes. Answer the question using the data file. It is an artificial time series from 1950 to 2020. For the exercise, we assume that it is a series of consumption expenditure in thousands of dollars. For each chart that you create, add a main title and axis titles. When the chart contains more than one line, use a different color and shape for each line and add a legend. Part A: Visualization 1. Plot the series using a line chart. Briefly describe what you see: Is it a positive or negative trend? Is the trend increasing? What kind of short term fluctuations do you observe? 2. Answer the previous question using the log-scale. Can you tell if the growth rate is increasing or decreasing on average over the period? 3. To better see how the growth rate evolves through time, plot the annualized growth rate of consumption expenditure. Describe what you see. Is it constant on average? Part B: Time Series Decomposition 1. Fit a linear and quadratic trends to your series. Then, create a line chart with your original series and the two trends. Which trend seems to best fit the series? Explain. 2. Fit a linear and quadratic trends to the log of your series. Then, create a line chart with the log of your series and the two trends. Which trend seems to best fit the series? Do you see a difference between the best trend in this question and in the previous one? Explain.Answer the following questions using the log of your series and the trends computed in question 2. 3. Plot the detrended series using the trend that best fit the series. Briefly describe what you see: Do you better detect short term fluctuations? 4. Using a moving average of order 5, compute the cyclical component of your series. Then, plot the cycle and briefly describe what you see: interpret the values of some peaks and troughs. 5. Plot the low frequency of your series and briefly describe what you see. 6. Compute the seasonal component and represent it on a bar chart (only the 4 quarters). Interpret the four seasonal values. Part C: Comovement For this part, select any other series in the file assignment1.zip and answer the following questions: . Create a scatter plot of your series expressed in logs against the selected series also expressed in logs . Using the log of the selected series, compute its cyclical component. Then create a scatter plot of this cycle with the cycle of your series computed in Part B. Econ 102 Assignment 1 Page 1 of 2 . Looking at the two scatter plots, what can you say about the type of comovement between the two series