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Econometric Tutorial

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Table 2.4 gives data on Y, X2, X3, X4, X5, and X6 from year 1985 to 2007.

Table 2.4

Year

Y

X2

X3

X4

X5

X6

1985

27.8

397.5

42.2

50.7

78.3

65.8

1986

29.9

413.3

38.1

52

79.2

66.9

1987

29.8

439.2

40.3

54

79.2

67.8

1988

30.8

459.7

39.5

55.3

79.2

69.6

1989

31.2

492.9

37.3

54.7

77.4

68.7

1990

33.3

528.6

38.1

63.7

80.2

73.6

1991

35.6

560.3

39.3

69.8

80.4

76.3

1992

36.4

624.6

37.8

65.9

83.9

77.2

1993

36.7

666.4

38.4

64.5

85.5

78.1

1994

38.4

717.8

40.1

70

93.7

84.7

1995

40.4

768.2

38.6

73.2

106.1

93.3

1996

40.3

843.3

39.8

67.8

104.8

89.7

1997

41.8

911.6

39.7

79.1

114

100.7

1998

40.4

931.1

52.1

95.4

124.1

113.5

1999

40.7

1021.5

48.9

94.2

127.6

115.3

2000

40.1

1165.9

58.3

123.5

142.9

136.7

2001

42.7

1349.6

57.9

129.9

143.6

139.2

2002

44.1

1449.4

56.5

117.6

139.2

132

2003

46.7

1575.5

63.7

130.9

165.5

132.1

2004

50.6

1759.1

61.6

129.8

203.3

154.4

2005

50.1

1994.2

58.9

128

219.6

174.9

2006

51.7

2258.1

66.4

141

221.6

180.8

2007

52.9

2478.7

70.4

168.2

232.6

189.4

  1. Compute and interpret the correlations for :
  1. Y and X2;
  2. Y and X3;
  3. Y and X4;
  4. Y and X5;
  5. Y and X6.

Y

X2

X3

X4

X5

X6

Y

 1.000000

 0.947171

 0.839958

 0.912392

 0.935355

 0.937413

X2

 0.947171

 1.000000

 0.931681

 0.957131

 0.985878

 0.982757

X3

 0.839958

 0.931681

 1.000000

 0.970112

 0.928469

 0.944529

X4

 0.912392

 0.957131

 0.970112

 1.000000

 0.940567

 0.972965

X5

 0.935355

 0.985878

 0.928469

 0.940567

 1.000000

 0.983349

X6

 0.937413

 0.982757

 0.944529

 0.972965

 0.983349

 1.000000


correlation for y,x2=0.9472

...

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