Is the regression line shown in Figure I.3 of the Introduction the PRF or the SRF? Why?

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Is the regression line shown in Figure I.3 of the Introduction the PRF or the SRF? Why? How would you interpret the scatterpoints around the regression line? Besides GDP, what other factors, or variables, might determine personal consumption expenditure?

8000 7000 6000 5000 4000 3000 2000 1000 2000 10,000 4000 6000 8000 12,000 GDP (X) PCE (Y)

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Basic Econometrics

ISBN: 978-0073375779

5th edition

Authors: Damodar N. Gujrati, Dawn C. Porter

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