ECO220Y-L0101 and L0301 Project 2
Project 2 is the continuation of data analysis in Project 1. You will use the same data file given
in ‘project-data_fall2022.xlsx’ posted in Quercus. Your goal is to build a multiple regression
model to predict oil price.
Here are some suggestions, but do not limit your analysis to just these areas.
(a) Draw scatterplots between oil-price-br and each one of the 9 independent variables.
Comment on the relationships between oil price and each independent variable.
(b) Develop an estimated multiple regression equation that can be used to predict oil price given
the 9 independent variables. Test the significance of this model at a 5% level of significance.
Test the significance of each independent variable at a 5% level of significance.
(c) Comment on the validity of the multiple regression model developed in (b).
(d) Eliminate the insignificant independent variables. Develop an estimated multiple regression
equation that can be used to predict oil price given the significant independent variables.
Test the significance of this model at a 5% level of significance. Test the significance of
each independent variable at a 5% level of significance.
(e) Comment on the validity of the multiple regression model developed in (d).
(f) Create or transform new variables from the existing 9 independent variables. Develop an
estimated multiple regression equation that can be used to predict oil price given the existing
independent variables and your transformed new variables. Comment on this process and
the validity of the multiple regression model.
(g) Which model do you recommend, and why?
• Software for statistical analysis: Python, Stata, R or Excel.
• This is a group assignment. Each group of students consists of 4 or less students. The smallest
group consists of 1 student, and the largest group consists of 4 students. You can use the same
grouping as in Project 1, or you can form new groups from the students in sections L0101 and
L0301. Every student in the same group will receive the same mark for the assignment.
• Deadline to submit Project 2 is 5pm Friday April 14, 2023
Method to submit Project 2
1. The front page of Project 2 report should look like the following:
ECO220Y5Y-L0101 and L0301 Project 2
Deadline: 5pm Friday April 14, 2023
Project 2 is completed by the group of following students:
Group Member Last Name First/Other Name Student ID Signature
1
2
3
4
2. Each student in the same group MUST sign the front page.
3. Each group of students submits ONE copy of the report with each group member’s name and
student number on the front page shown above.
4. Type Project 2 report if possible, otherwise write clearly. Only include your report, do NOT
include the data file.
5. Limit your report to 6 (or less) pages including your front page.
6. Make a photocopy of your Project 2 report.
7. Scan and email the Project 2 report to (to be updated) on or before the deadline.