Regional Gasoline Price Change

1
Regional Gasoline Price Change

• Kristal Chin, Heather Coleman, Yuyuan Liu, Karen
  McNeany, David Parker, Laura Pomella, Yongyang Yu

2
Question

• Are gasoline prices different across the country
  ?
• Ho(1) 19932005 prices are regionally equivalent
• Ha (1) West Coast prices have been higher than
  in other regions of the U.S.
• Ho(2) 19932005 prices change at the same rate
• Ha (2) West Coast prices have increased more
  quickly than in other regions of the U.S.

3
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

4
Data Set
5
Data Set
Gasoline Price Histograms

• West Coast Average of Other Regions

6
Statistics

• 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 gt 0.05
• 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 ltltlt 0.05
• 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

7
Data Set

• Linear Regression of Gasoline Price Change

8
Statistics
Box and Whisker Plot compares the regional rates
of gasoline price increase
West Coast
New England
Rocky Mountains
Gulf Coast
Cents/Gallon Week Index
Mean Price
9
Conclusions

• Every region of the U.S. has statistically
  significantly lower gasoline prices than the West
  Coast region
• The prices on the west coast increase more
  quickly than the average of all other regions,
  but not statistically significantly