Recall that Table 15.16 gives the price of a gallon of regular gasoline in the United States (in dollars) for the years 2003 through 2011. Table 15.20 gives the price of a gallon of regular gasoline in the United States (in dollars) for the years 1990 through 2002.

a. By using 1990 as the base year, construct a simple index for the prices of a gallon of regular gasoline in Tables 15.20 and 15.16.

b. Plot the indices you have constructed versus time (1990 through 2011). Describe the pattern that you see.

Transcribed Image Text:

TABLE 15.16 Price of a Gallon of Regular Gasoline (in Dollars): 2003 to 2011 DS PriceGas1 Year 2003 2005 2006 2007 2009 2.35 2008 3.27 2004 2010 2.78 2011 3.63 1.59 Price per Gallon Index (Base Year = 2003) 2.59 162.89 1.88 118.24 2.30 2.80 205.66 100.0 144.65 176.10 147.80 174.84 228.30