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Econometrics

Based on certain variables/factors, this mathematical analysis will attempt to create an equation that will predict the fuel economy of an automobile. The dependent variable used will be miles per gallon used on a highway. The automobile used for this analysis will include the 2 most popular 2002 models from every major auto brand on the American market. Popularity will be based on the number of units sold in a given year. In total, this analysis will use 68 different auto modelsThe autos chosen will include one compact or midsize car and a Sports Utility Vehicle (SUV) or light truck. In the event an auto name does not have an SUV or light truck, another auto will be chosen and vice-versa. This analysis will not include commercial trucks (trucks with air brakes), buses, motorcycles and mopeds. The information needed for this analysis will be obtained from Carguides.AOL.com. All the specifications will be obtained for all brand new autos.Independent Variables: Cross Sectional Data Total Weight of the Automobile (Expected Negative Correlation):The weight of the automobile will be measured in pounds. The automobile will contain the least standard features and packages that are available to the public. Factors such as emissions systems, radios, AC systems and other luxuries add weight to the automobile; therefore this analysis will try to equalize each auto by selecting the most standard package of trim and accessories. Although this analysis will try to create a universal standing ground for the weight of the autos, a weakness still may be experienced due to the weight variations. The weight of the automobile is expected to have a negative correlation with the overall fuel economy. Logically, the heavier something is, the more energy (fuel) it takes to move that object; therefore the lower Miles Per Gallon.Number of Passenger Doors (Expected Negative Correlation):The number of passenger doors will be represented by a dummy variable. This...

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