Watch Data Analysis & Probability

The U.S. mortgage crisis demonstrates how data analysis and probability are used in finance and economics. Students learn the key factors that determine monthly mortgage payments, and use the TI-Nspire to create an amortization table. Students use the amortization table to run probability simulations, determining potential loan defaults on subprime mortgages and run a number of scenarios to test adjustable rate mortgages' effects as housing markets change.