This file includes annual data on the U.S. Gasoline market from 1953 to 2004.
? Quantity is U.S. Finished Motor Gasoline Product Sold (in Thousands of Barrels)
? Pop is U.S. total population in thousands,
? GasPIndex is the average nominal price for gasoline, in the form of an index,
? Income is a measure of personal consumption expenditures, assuming income is approximately equal to consumption, measured in $,
? PNewCar is the price index for new cars,
? PUsedCar is the Price index for used cars,
? PPublicTr is the price index for public transportation,
? CPId is the consumer price index for consumer durables,
? CPIn is the consumer price index for consumer nondurables,
? PCEIndex is the personal consumption expenditures price index.
3) Predict the sign of each slope coefficient explaining the logic of your predictions.
4) Estimate the demand for gasoline. In a brief report write out the estimated demand equation and show the standard errors of the estimates.
5) Give a one/two-sentence interpretation of each coefficient. Indicating that there is a positive or negative relation is not sufficient. Give a precise interpretation of each coefficient and compare it to your prediction.
6) Based on your equation, predict per capita gasoline purchases in thousands of barrels in 2008. Assume that the gasoline price adjusted for inflation will rise by 40%, while all other variables will remain at 2004 level.
Coefficient calculation and explanation of questions.