Table 1. Three-month CD certificate rates for Long Island banks and thrifts

7.56 7.57 7.71 7.82 7.82 7.90 8.00 8.00 8.00 8.00

8.00 8.00 8.00 8.00 8.05 8.06 8.11 8.17 8.30 8.33

8.33 8.40 8.50 8.51 8.55 8.57 8.65 8.65 8.71

7.51 7.75 7.90 8.00 8.00 8.00 8.15 8.20 8.25 8.25

8.30 8.30 8.33 8.34 8.35 8.35 8.36 8.40 8.40 8.40

8.40 8.40 8.40 8.45 8.49 8.49 8,49 8.50 8.50 8.50

8.50 8.50 8.50 8.50 8.50 8.50 8.52 8.70 8.75 8.78

Construct a Histogram for the data using intervals 7.5-7.7, 7.7-7.9 etc

Using the uniform kernel on the interval[-1, 1 ] construct kernel a density curve

Using a Gaussian kernel present kernel density curves with bandwidth

h=0.04

h=0.08

h=0.16

What do you observe as the bandwidth increases.

Obtain and present kernel density curve corresponding to it.

Plot the cross-validation curve and give the corresponding approximate optimal bandwidth.*