Repor

[MIDTERM PROJECT]

SUBMITTED TO:

SIR GHULAM GHOUSE RAZA

SUBMITTED BY:
ALI RAZA BHUTTO ROLL NO: 04131613008
CLASS: IR-B
nd
2 SEMESTER (Spring)
DATED: 30 April, 2017
Question 1:
1. What are the major types of data, explain with appropriate examples?
2. Explain following with suitable examples
a. Qualitative Variables b. Quantitative Variables c. Random and Continuous
Variables

ANS: 1 : There are three major types of data:

(i) Time Series (ii) Cross-Sectional (iii)Panel
Time Series: Whenever same measurements are recorded on a regular basis/overtime OR
Collection of observations or data that are obtained through repeated measurements overtime, is
called Time Series Data.

For example: Measurements of Energy Use, Electric power Consumption and Exports of
Goods and Services Overtime in Pakistan.

YEAR Energy use Electric power Exports of goods and

consumption services
2000 12069.86385 14072.05202 10.66464335
2001 11827.88633 13946.61415 9.666070536
2002 11585.9088 13821.17628 9.13238644
2003 11343.93128 13695.73841 9.037519102
2004 11101.95375 13570.30054 9.625368067
2005 10859.97623 13444.86267 9.996398275
2006 10617.9987 13319.4248 10.65479167
2007 10376.02118 13193.98693 11.49790694
2008 10134.04365 13068.54906 12.51439847
2009 9892.066125 12913.71143 11.01165643
2010 9650.0886 13994.02301 12.37830094
2011 9408.111075 13540.47586 13.57379201
2012 9166.13355 14954.5432 13.6066085
2013 8924.156025 13988.25596 13.63931151
Cross-Sectional Data: Different observations from different entities relating to one period of
time is called Cross Sectional Data.

For example: Measurements of Energy Use, Electric power Consumption and Exports of
Goods and Services in Pakistan, Germany, India, UAE & United Kingdom respectively at
a particular period of time (2013).

Country & Electric power Energy use Exports of goods and

Year consumption services
Pakistan 9762.076942 4226.269871 18.50498208
2013
Germany 8373.981154 6839.856993 22.60807392
2013
India 11988.25596 9915.844739 21.63931151
2013
UAE 90093.06478 8539.211202 29.62654328
2013
UK 11977.66681 5407.291323 28.75701369
2013
 1.1.3 – Panel Data: It is also called Cross-sectional Time series data. In this type of data,
multiple observations are taken at two or more time periods.

For Example: Measurements of Energy Use, Electric power Consumption and Exports of
Goods and Services in Pakistan, Germany, United States of America, UAE & United
Kingdom respectively at different periods of time.

YEAR Energy use Electric power Exports of goods and

consumption services
Pakistan
2010 1845.737283 2943.589954 26.26741464
2011 1994.399592 3298.003913 26.49432088
2012 2079.119715 3474.98362 25.40819715
2013 2226.269871 3762.076942 24.50498208
Germany
2010 4024.252396 7737.017526 26.04322983
2011 3853.84946 7233.684103 27.80349869
2012 3844.554559 7364.400648 28.52181363
2013 3839.856993 7373.981154 28.60807392
India
2010 7161.51709 13394.02301 12.37830094
2011 7029.246764 13240.47586 13.57379201
2012 6812.489605 12954.5432 13.6066085
2013 6915.844739 12988.25596 13.63931151
UAE
2010 4827.811257 6409.895218 29.21558677
2011 5057.520887 6485.760845 28.25080713
2012 5174.400368 6617.136241 27.38033591
2013 5093.064779 6539.211202 26.62654328
UK
2010 3224.864161 5700.871797 28.25654922
2011 2966.744784 5472.603879 30.52231995
2012 3028.134185 5451.983743 29.79867992
2013 2977.666808 5407.291323 29.75701369
2/1: Qualitative Variables: These are variables which cannot be measured in numbers. They
describe data which fits into categories and takes names/labels.

For example: (i) The color of eyes, blue, black, green, brown, etc.

(ii) Names of different states such as Pakistan, Germany, INDIA, UAE, UK etc.

(iii) Different computer brands such as HP, Dell, Acer, Novatech etc.

2/1: Quantitative Variables: These variables can be measured in numbers. They are
measured on a numeric or quantitative scale.

For example: Energy Use, Electric power consumption, Exports (variables given above in Part
1: types of Data),Gross Domestic Product, Grade point average, Height, weight etc.

1.2(c). Random and Continuous Variables: When the value of a variable is unknown it is
called Random variable.

Random Variables are further divided in two categories, Discrete and Continuous.

Discrete variables have specific values and Continuous variables can have any values within a
continuous range.

Discrete Random Variables Example:

What number of heads appear if a coin is flipped 4 times (possible outcomes are 0, 1, 2, 3, 4) ,
What number of classes have been missed in a single week (possible outcomes are 0, 1, 2, 3, ...,
up to the maximum number of classes)

Continuous Random Variables Example:

Heights of Trees or Individuals, Time to reach at a particular place i-e school and Time to finish
a test.
Question 2:
1. Take any reliable data from any reliable source, either from the internet or
statistical book.
a. Provide detail description of the data set.
b. provide appropriate graphical representation of data set.

Ans: 2 :

1/2 – The data has been taken from Index Mundi and WDI.

1/2(a). According to Robert J. Barro, in his book "Determinants of Economic Growth: A Cross-
Country Empirical Study," GDP or the growth rate is affected by initial schooling and life
expectancy, fertility rate, government consumption, rule of law, inflation and trade.

Thus, the variables or determinants taken for the data set are GDP (annual %)) and Genreal
Government Final consumption expenditure (% of GDP) Of United States of America from
2000-2015.

YEAR GDP (annual General government final consumption expenditure (% of

%) GDP)
2000 4.092176 14.04185
2001 0.975982 14.54676
2002 1.786128 15.04315
2003 2.806776 15.25187
2004 3.785743 15.22569
2005 3.345216 15.12211
2006 2.666626 15.08273
2007 1.77857 15.263
2008 -0.29162 16.09235
2009 -2.77553 16.93672
2010 2.531921 16.85476
2011 1.601455 16.30927
2012 2.224031 15.74813
2013 1.677332 15.11981
2014 2.370458 14.70441
2015 2.596148 14.44231
1/2(b). Graphical representation of Data:
(i) Graph of GDP (annual %):
4.1
GDP (annual %)
3.6

3.1

2.6

2.1

1.6

1.1

0.6
0.1
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
-0.4

(i) Graph of Genral Government Final Consumption Expenditure:

17 General
Government Final
Soncumption
16.5
Expenditure (% of
GDP)
16

15.5

15

14.5

14
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
 Question 3:

1. Use your own data set and Quantify the following

a. Estimate measures of central tendency.
b. Interpret them according to the objective of study.
c. Compare them in appropriate way and provide graphical representation.

Ans:3:
1/3(a) Measures of Central Tendency of the Data set used in Question No.2

(i) MCT of GDP:

Year Observation(GDP)
2000 4.092176
2001 0.975982
2002 1.786128
2003 2.806776
2004 3.785743
2005 3.345216
2006 2.666626
2007 1.77857
2008 -0.29162
2009 -2.77553
2010 2.531921
2011 1.601455
2012 2.224031
2013 1.677332
2014 2.370458
2015 2.596148
Sum 31.17141
Count(of Years/Observations) 16
Average(mean) 1.948213
Median 2.297244
 (ii) MCT of General Government Final Consumption Expenditure:

Year Observation(Government Consumption

2000 expenditure
14.04185
2001 14.54676
2002 15.04315
2003 15.25187
2004 15.22569
2005 15.12211
2006 15.08273
2007 15.263
2008 16.09235
2009 16.93672
2010 16.85476
2011 16.30927
2012 15.74813
2013 15.11981
2014 14.70441
2015 14.44231
Sum 245.7849
Count 16
Average(mean) 15.36156
Median 15.1739

1/3(b) According to this estimation it can be interpreted that, the mean as well as median of
Government Consumption Expenditure is the largest.
The lowest mean and median is that of GDP. The mean is taken out by dividing the sum of all
observations by number of years (number of observations). It can be done directly by
applying [=Average(Range)] in excel and [=Median(Range)] for finding median in excel.

1/3(c) (i)Comparison
GDP General government final consumption expenditure (% of
(annual GDP)
Mean %)
1.948213 15.36156
Median 2.297244 15.1739
(ii) Graphical Representation
(i) Graph Of Mean (average):

16 15.36155711

14

12

10

4
1.948213079
2

0
GDP (annual %) General government final consumption expenditure (% of
GDP)

(ii) Graph of Median:

16 15.17389937

14

12

10

4 2.297244263
2

0
GDP (annual %) General government final consumption
expenditure (% of GDP)
Question 4:
1. Use your own Data set and Quantify the Following:
a. Estimate measures of dispersion
b. Interpret them according to the objective of study
c. Compare them in appropriate way and provide graphical representation

Ans:4:

1/4(a): Measures of Dispersion of Data set Used in Question 2:

(i) M.O.D of GDP:

Deviation about the mean

2
Year Observation(GD x-mean (x-mean)
2000 P)
4.092176449 2.14396337 4.596579
2001 0.975981834 -0.972231245 0.945234
2002 1.786127687 -0.162085391 0.026272
2003 2.806775956 0.858562878 0.73713
2004 3.78574285 1.837529771 3.376516
2005 3.345216063 1.397002985 1.951617
2006 2.666625826 0.718412748 0.516117
2007 1.77857024 -0.169642839 0.028779
2008 -0.291621459 -2.239834537 5.016859
2009 -2.775529574 -4.723742653 22.31374
2010 2.531920616 0.583707538 0.340714
2011 1.601454672 -0.346758406 0.120241
2012 2.224030854 0.275817775 0.076075
2013 1.67733153 -0.270881549 0.073377
2014 2.370457671 0.422244593 0.17829
2015 2.596148041 0.647934962 0.41982
Sum 31.17140926 1.11022E-15 40.71736
Count 16 16 16
Average(mean) 1.948213079
2
Variance (s ) 2.714490983
Standard 1.647571237
Deviation (s)
 (iii) M.O.D of General Government Final Consumption Expenditure:

Deviation about
the mean
Year Observation(Government x-mean (x-
Consumption mean
2
2000 expenditure)
14.04184767 -1.319709445 )1.7416
33
2001 14.54675769 -0.814799417 0.6638
98
2002 15.04315094 -0.318406176 0.1013
82
2003 15.25186631 -0.1096908 0.0120
32
2004 15.22568605 -0.135871063 0.0184
61
2005 15.12211268 -0.239444429 0.0573
34
2006 15.08272873 -0.278828383 0.0777
45
2007 15.26299703 -0.098560082 0.0097
14
2008 16.09234504 0.730787926 0.5340
51
2009 16.9367238 1.575166689 2.4811
5
2010 16.85476009 1.493202981 2.2296
55
2011 16.30927355 0.947716434 0.8981
66
2012 15.7481253 0.386568189 0.1494
35
2013 15.11981206 -0.241745054 0.0584
41
2014 14.70441473 -0.657142379 0.4318
36
2015 14.44231212 -0.919244992 0.8450
11
Sum 245.7849138 -1.42109E-14 10.309
95
Count 16 16 16
Average(mean) 15.36155711
2
Variance (s ) 0.687329692
Standard 0.829053492
Deviation (s)
 1/4(b) According to this estimation we can interpret that, GDP has the highest fluctuations, ups
and downs (deviation from its mean value) than the other variable.
Similarly, Government consumption expenditure has the lowest fluctuation than its mean value.
2
Variance is taken out by dividing sum of (x-mean ) by ( number of observations -1).
It can be done directly by applying [=Var.s(Range)] in excel. Standard Deviation can be found
by either taking out the Square root of variance [=Sqrt(Variance)] or directly by
[=STDEV(Range)].

1/4(c) (i)Comparison

GDP (annual General government final consumption expenditure

%) (%
Variance 2.714491 of GDP)
0.68733
Standard 1.647571 0.829053
Deviation

(ii) Graphical Rpresentation:

(i) Graph Of Variance In Data:

3
2.714490983

2.5

1.5

1
0.687329692

0.5

0
GDP (annual %) General government final consumption expenditure (%
of GDP)
 (ii) Graph Of Standard Deviation in Data:

1.7 1.647571237

1.5

1.3
1.1

0.9 0.829053492

0.7

0.5

0.3

0.1
-0.1 GDP (annual %) General government final consumption expenditure (%
of GDP)
 Question 5:

1.Use your own data set and employ a regression Yt = a + B Xt + Et, Where
(Yt) is the dependent variable and (t) for time period, (Xt) is independent variable and (Et)
is a random error term.

a. Compute the ordinary least square estimate of the parameters a and B.

b. How would the change occur in dependent variable if one unit increase
(decrease) in independent variable?
c. Calculate predicted values of your dependent variable.

Ans:5:
1/5 - Regression of the Data used throughout the write up, Where GDP is an dependent variable
(Yt) and Government Consumption Expenditure is Independent variable (Xt) as it affect the GDP.

SUMMARY OUTPUT

Regression Statistics
Multiple R 0.58974
R Square 0.34779
Adjusted 30.30120
R Square 7
Standard 1.37726
Error 8
Observation 16
s
ANOVA
df SS MS F Significanc
e
Regression 1 14.1612 14.1612 7.4655 F
0.016197
Residual 14 326.5561 31.89686 9
Total 15 340.7173 7
6

Coeffi Sta t P- Lowe Uppe Lowe Uppe

ci nd Stat val r r r r
ents ard ue 95% 95% 95.0 95.0
Intercept 19.9517 Err
6.598 3.02 0.009 5.800 34.10 %
5.800 %
34.10
4 0 3 1 2 3 2 3
Government - 81
0.428 -87 1
0.016 -63 -21 -63 -21
Consumption 1.17199 9 2.73 1 2.091 0.252 2.091 0.252
expenditure 34 2 97 9 0 9 0
(X) 32 6 1 6 1
1/5(a) LEAST SQUARE ESTIMATES:
(i) GDP AND GENERAL GOVERNMENT FINAL CONSUMPTION EXPENDITURE:

(X) (Y)
General government final consumption GDP X Y XY
expenditure (% of GDP) (annual Square Square
%) d d
14.04184767 4.0921764 197.173 16.7459 57.4617
49 4859 0809 1832
14.54675769 0.9759818 211.608 0.95254 14.1973
34 1594 054 7125
15.04315094 1.7861276 226.296 3.19025 26.8689
87 3901 2116 8839
15.25186631 2.8067759 232.619 7.87799 42.8085
56 426 127 7166
15.22568605 3.7857428 231.821 14.3318 57.6405
5 5157 4892 3209
15.12211268 3.3452160 228.678 11.1904 50.5867
63 292 7051 3426
15.08272873 2.6666258 227.488 7.11089 40.2199
26 7059 3297 9396
15.26299703 1.7785702 232.959 3.16331 27.1463
4 0783 2097 1228
16.09234504 - 258.963 0.08504 -
0.2916214 5688 3075 4.69287
59 3134
16.9367238 - 286.852 7.70356 -
2.7755295 6131 4417 47.0083
74 778
16.85476009 2.5319206 284.082 6.41062 42.6749
16 9378 2007 1456
16.30927355 1.6014546 265.992 2.56465 26.1185
72 4036 7068 6232
15.7481253 2.2240308 248.003 4.94631 35.0243
54 4505 3239 1656
15.11981206 1.6773315 228.608 2.81344 25.3609
3 7167 1061 3749
14.70441473 2.3704576 216.219 5.61906 34.8561
71 8126 9572 9271
14.44231212 2.5961480 208.580 6.73998 37.4943
41 3793 4648 8031
SU 245.7849138 31.171409 3785.94 101.445 466.758
M 26 8936 9119 2752
Co 16 16 16 16 16
unt
Calculate r 174536.2628
Standard Deviation of X 0.829053492
Standard Deviation of Y 1.647571237
Calculate parameter B 346854.4904
Calculate parameter a -5328223.116
y-hat = -5328 +
Least Square Regression Equation 3468X

1/5(b) The Results show that GDP has negative relationship with General Government
Final Consumption Expenditure. It means that If Government Consumption
Expenditure(Independent Variable) will increase, GDP(dependent Variable) will decrease.
When Government Consumption Expenditure decreases, GDP increases.

Coefficients Standard t Stat P-value

Error
Intercept 19.95174 6.598081 3.02387 0.00911
Government Consumption -1.17199 0.428934 - 0.016197
expenditure (X) 2.73232

Scatter Diagram For Relationship Betweem GDP and General Government

Final Consumption Expenditure:
4.2
GDP and General
Government Consumption
3.7 Expenditure

3.2

2.7

2.2

1.7

1.2

0.7

0.2

-0.3 14 14.2 14.4 14.6 14.8 15 15.2 15.4 15.6 15.8 16

1/5(c) Predicted values of dependent Variable:
Observation Predicted
GDP (Y)
1 3.494894
2 2.903146
3 2.321381
4 2.076769
5 2.107452
6 2.228839
7 2.274996
8 2.063724
9 1.09174
10 0.10214
11 0.198201
12 0.837503
13 1.495161
14 2.231535
15 2.718375
16 3.025555

PROBABILITY
OUTPUT

Percentile GDP (Y)

3.125 -2.77553
9.375 -0.29162
15.625 0.975982
21.875 1.601455
28.125 1.677332
34.375 1.77857
40.625 1.786128
46.875 2.224031
53.125 2.370458
59.375 2.531921
65.625 2.596148
71.875 2.666626
78.125 2.806776
84.375 3.345216
90.625 3.785743
96.875 4.092176
 Government Consumption expenditure
(X) Residual Plot
4
2
Residuals

0
14 14.5 15 15.5 16 16.5 17 17.5
-2
-4
Government Consumption expenditure (X)

Government Consumption expenditure

(X) Line Fit Plot
6

2
GDP (Y)

0
14 14.5 15 15.5 16 16.5 17 17.5
-2
-4
Government Consumption expenditure (X)

Normal Probability Plot

6

2
GDP (Y)

0
0 20 40 60 80 100 120
-2

-4
Sample Percentile