Question

Gas Price depends on Crude oil price. A sample data is given below. Use regression model to estimate Gas Price when Crude oil price is $100 Crude oil Price (in $) 30 45 53 62 88 Gas Price (in $) 1.4 2.6 3.0 3.2 3.5

Answer 1

The statistical software output for this problem is:

Hence,

Estimated regression equation:

Gas = 0.8716 + 0.0336*Crude

For Crude = $100:

Estimated gas price = 0.8716 + 0.0336*100 = $ 4.23