Assignment 1

Sheet1

				ECO 500 Excel Assignment One
	DPI	PCE Insurance and Financial Services
1964.	462	18
1965.	498	19		a) Find the equation of the trendline (line of best fit) that represents the data.
1966.	537	21		Expenditures on insurance and financial services = -38.062 + 0.0758 DPI
1967.	575	23		b) What is the value of R2?
1968.	625	26		0.9943
1969.	674	29		c) What does the R2 represent?
1970.	736	31		Over 99.4% of the variation in consumer expenditures on motor vehicles and parts can be explained by changes in disposable personal income.
1971.	801	34		d) How well did the equation predict values for 2011 and 2012?
1972.	869	38		The equation over estimated the demand for motor vehicles and parts for 2011 and 2012, but 3.75% and 4.55% respectively.
1973.	978	42		e) If DPI increases at a rate of 2.2% in 2013 and then at a rate of 2.6% in 2014, what are the predicted values for consumer spending on insurance and financial services?
1974.	1,072	46
1975.	1,187	54		2013	886
1976.	1,302	59		2014	910
1977.	1,435	68
1978.	1,607	81
1979.	1,791	88
1980.	2,003	96
1981.	2,237	102
1982.	2,413	116
1983.	2,600	146
1984.	2,892	157
1985.	3,079	181
1986.	3,259	197
1987.	3,435	207
1988.	3,726	219
1989.	3,991	236
1990.	4,254	253
1991.	4,445	282
1992.	4,737	312
1993.	4,922	341
1994.	5,184	349
1995.	5,457	365
1996.	5,760	394
1997.	6,075	431
1998.	6,499	470
1999.	6,803	514
2000.	7,327	570
2001.	7,649	563
2002.	8,010	576
2003.	8,378	603
2004.	8,889	652
2005.	9,277	698
2006.	9,916	733
2007.	10,424	790
2008.	11,025	807
2009.	10,722	742
2010.	11,127	796
2011.	11,549	807	837
2012 p.	11,931	829	866
2013	12,194		886
2014	12,511		910
Source: Economic Report of the President, 2013. Appendix B.

US Consumer Expenditures on Insurance and Financial Services

462.3 497.8 537.4 575.1 624.7 673.8 735.5 801.4 869.0 978.1 1071.7 1187.3 1302.3 1435.0 1607.3 1790.9 2002.7 2237.1 2412.7 2599.8 2891.5 3079.3 3258.8 3435.3 3726.3 3991.4 4254.0 4444.9 4736.7 4921.6 5184.3 5457.0 5759.6 6074.6 6498.9 6803.3 7327.2 7648.5 8009.7 8377.799999999999 8889.4 9277.299999999999 9915.7 10423.6 11024.5 10722.4 11127.1 11549.3 11931.2 17.7 19.4 21.3 22.8 25.8 28.5 31.1 34.1 38.3 41.5 45.9 54.0 59.3 67.8 80.6 87.6 95.6 102.0 116.3 145.9 156.6 180.5 196.7 207.1 219.4 235.7 253.2 282.0 311.8 341.0 349.0 364.7 393.6 431.3 469.6 514.2 570.0 562.8 576.2 602.5 651.7 698.4 732.6 790.3 807.0 741.8 796.3 807.1 828.6

Disposable Personal Income, Billions of Dollars

PCE Insurance and Financial Services, Billions of Dollars

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