Economics 310 Menzie D. Chinn Spring 2004 Social Sciences 7418 University of Wisconsin-Madison Example of Simple Regression Application: Oil and Gasoline Prices 0.81.01.21.41.61.82.0101520253035401990 1992 1994 1996 1998 2000 2002GASPRICE OILPRICE_WTIOil price ($/barrel)WTI (right axis)US RetailGasoline Price($/gallon) Figure 1: Average of weekly regular gasoline prices, in dollars per gallon; and price per barrel of West Texas Intermediate. Source: IMF, International Financial Statistics and DOE Energy Information Administration, http://www.eia.doe.gov/. Dependent Variable: GASPRICE Method: Least Squares Date: 04/21/04 Time: 14:17 Sample(adjusted): 1990:08 2004:01 Included observations: 162 after adjusting endpoints Variable Coefficient Std. Error t-Statistic Prob. C 0.596438 0.031636 18.85339 0.0000OILPRICE_WTI 0.027559 0.001373 20.07885 0.0000R-squared 0.715889 Mean dependent var 1.212457Adjusted R-squared 0.714113 S.D. dependent var 0.183697S.E. of regression 0.098220 Akaike info criterion -1.790945Sum squared resid 1.543546 Schwarz criterion -1.752827Log likelihood 147.0666 F-statistic 403.1602Durbin-Watson stat 0.563041 Prob(F-statistic) 0.000000 [OVER]0.81.01.21.41.61.810 15 20 25 30 35 40OILPRICE_WTIGASPRICEGASPRICE vs.
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