Gas Prices – Final Paper

BUS308: Statistics for Managers

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As a manager of a delivery service, it is important to observe the changes in the cost of gas. This information is significant because it determines whether the price of our product increases or decreases for the year.

I recorded the annual average mean of gas prices between the years of 1982 to 2011. To get the mean I used the formula (=average(numbers in cells)), I calculated the expected value by multiplying the slope by the year and subtracting the intercept amount, and the residual amount was calculated by subtracting the annual mean by the expected value.

The United States saw a noticeable uptick in the price of gas from 1976-1983, thanks to the situation in Iran. Gas prices have always been in an up and down rollercoaster according to our data the average mean of gas in 1982 was 1.296. From 1982 to 1983 gas prices went down because of another crisis the United States was dealing with. From the years 1984-1992 this period of time includes the Gulf War and the recession that followed shortly after: In 1986 the gas price went as low as 0.927 this came as a result of reduced demand and overproduction, which resulted in the short-term loss of OPEC unity. In the years 1993 – 2000 the United States was in an Economic boom. The gas prices remained average during this period until the year 2000 where it had a sizable unstick reaching 1.510 because of the tech stock market coming undone.

From 2001 – 2009 the United States went through the 9/11 bombing, the Afghanistan wars and Iraq, which put the global economics through a meltdown. In 2008 was the highest gas had reached in history reaching 3.266. According to the statistical analysis there was a drastic fall in gas prices