Regional Gasoline Price Change Kristal Chin, Heather Coleman, Yuyuan Liu, Karen McNeany, David...
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Regional Gasoline Price Change Kristal Chin, Heather Coleman, Yuyuan Liu, Karen McNeany, David Parker, Laura Pomella, Yongyang Yu
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Transcript of Regional Gasoline Price Change Kristal Chin, Heather Coleman, Yuyuan Liu, Karen McNeany, David...
Regional Gasoline Price Change
Kristal Chin, Heather Coleman, Yuyuan Liu, Karen McNeany, David Parker, Laura Pomella,
Yongyang Yu
Question
• Are gasoline prices different across the country ?
• Ho(1): 1993–2005 prices are regionally equivalent
• Ha (1): West Coast prices have been higher than in other regions of the U.S.
• Ho(2): 1993–2005 prices change at the same rate
• Ha (2): West Coast prices have increased more quickly than in other regions of the U.S.
Data Set
• U.S. Department of Energy (EIA)
• U.S. Regular Weekly Retail gas prices from April 1993 – November 2005
• Country divided into eight regions
for analyses
Regional Gasoline Prices from April 1993 to November 2005
50
100
150
200
250
300
350
1 51 101 151 201 251 301 351 401 451 501 551 601 651
Time index (weeks)
Ga
so
lin
e p
ric
es (
ce
nts
pe
r g
all
on
)
East Coast
New England
Central Atlantic
Lower Atlantic
Midwest
Gulf Coast
Rocky Mountain
West Coast
Data Set
Data Set
West Coast Average of Other Regions
0
20
40
60
80
100 120 140 160 180 200 220 240 260 280 300
Series: WESTCOASTSample 1 660Observations 655
Mean 148.0446Median 137.7000Maximum 297.4000Minimum 102.5000Std. Dev. 36.08569Skewness 1.619988Kurtosis 5.759430
Jarque-Bera 494.3039Probability 0.000000
0
50
100
150
200
80 100 120 140 160 180 200 220 240 260 280 300 320
Series: AVGWOWESTSample 1 659Observations 659
Mean 135.1150Median 123.5000Maximum 310.6714Minimum 89.68571Std. Dev. 35.66161Skewness 1.718967Kurtosis 6.556075
Jarque-Bera 671.7699Probability 0.000000
Gasoline Price Histograms
0
50
100
150
200
80 100 120 140 160 180 200 220 240 260 280 300 320
Series: AVGWOWESTSample 1 659Observations 659
Mean 135.1150Median 123.5000Maximum 310.6714Minimum 89.68571Std. Dev. 35.66161Skewness 1.718967Kurtosis 6.556075
Jarque-Bera 671.7699Probability 0.000000
0
20
40
60
80
100 120 140 160 180 200 220 240 260 280 300
Series: WESTCOASTSample 1 660Observations 655
Mean 148.0446Median 137.7000Maximum 297.4000Minimum 102.5000Std. Dev. 36.08569Skewness 1.619988Kurtosis 5.759430
Jarque-Bera 494.3039Probability 0.000000
Statistics1. F - tests determine whether variances of prices
on the West Coast and each other region are equivalent
• The p - value for each F - test was > 0.05
2. Two sample t - tests determine whether West Coast prices are equivalent to each of the other regions
• The p - value for each t - test was <<< 0.05
3. Dummy variable ANOVA tests (1) including West Coast and (2) using C instead to represent it
• Coefficients are significantly different, and therefore the West Coast has higher prices
Data Set
Linear Regression of Gasoline Price Change
Regional Gasoline Prices from Apr. 2003 to Nov. 2005
y = 0.1473x + 99.216
R2 = 0.6008
y = 0.1459x + 86.966
R2 = 0.606750
100
150
200
250
300
350
0 100 200 300 400 500 600
Time index (weeks)
Ga
so
line
pri
ce
s (
ce
nts
pe
r g
allo
n)
West Coast
Other Regions
West :
Other (avg) :
Statistics
WestCoast
MeanPrice
New England
RockyMountains
GulfCoast
Cents/GallonWeek Index
Box and Whisker Plot compares the regional rates of gasoline price
increase
Conclusions
1. Every region of the U.S. has statistically significantly lower gasoline prices than the West Coast region
2. The prices on the west coast increase more quickly than the average of all other regions, but not statistically significantly
