ECO 301: Milestone One
Download the Regression Analysis Practice document (Excel file).
Make sure you have the Data Analysis ToolPak add-in for your Excel. You can do that by going to the Data tab and searching for Data Analysis. If it does not appear, you will need to download it. The steps to download add-ins varies with each version of Excel. Here are the steps for the 2007 version:
Click on the Excel icon in the upper-left corner of your spreadsheet.
Click on Excel Options.
Along the left-side menu, click on Add-Ins.
Select Analysis ToolPak and follow the instructions.
At the bottom, click on the “Demand for Jet Fuel” tab. The sample demand equation is estimated using this data set, and the results are shown.
Use the procedure described to estimate the demand for gasoline using the same steps identified in the example below. Sample answers are based on the “Demand for Jet Fuel” data.
Evaluate adjusted R2.
The adjusted R2 is 0.778421. It indicates that approximately 78% of the variation in the demand for jet fuel across states is explained by the three independent variables—price, state GDP, and state population.
Evaluate each of the independent variables using a t-test.
Table 1 provides the results of the t-tests for each of the independent variables.