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Multiple Regression Analysis Empirical Project

Several factors have impacts on the GDP and they include. consumptions, investments, disposable income, exports among others. This study was meant to determine the impact of an increasing consumption, investment, disposable income and exports (all in Billion Dollars) on the GDP growth. To make this a reality, economic data (secondary) was used and aimed to estimate the economic model shown below. GDP = β0 + β1C + β2I + β3PDI + β4NT In the above economic model, GDP was considered as the dependent variables (DV) while consumptions, investment, disposable income and net exports were considered as the independent variables (IV).Further, simple regression models of the nature GDP = β0 + β1ya (where you are the IV) were estimated. From the results, investments and disposable income have a statistically significant impact on GDP while consumption and net exports are not significant at 5% level of significance. Considering each IV alone Vs GDP, then it is significant at 5% level of significance. From the results, investments and disposable income have a statistically significant impact on GDP while consumption and net exports are not significant at 5% level of significance. Considering each IV alone Vs GDP, then it is significant at 5% level of significance. The GDP growth of a country is determined by several factors which include consumption expenditures, investments (domestic and external), disposable income, net exports (resulting from the difference between exports and imports) among many others. This study was meant to determine the impact of increasing consumption expenditures, investments, disposable income and exports on the GDP growth. To make this a reality, economic data (secondary) was used and aimed to estimate the economic model where GDP was considered as the dependent variables (DV) while consumptions, investment, disposable income and net exports were considered as the independent variables (IV). GDP is the cumulative total amount of goods and services which a country produces within a given year. GDP growth changes year-in-year-out depending on the economic conditions (amount of investments, consumption levels, disposable incomes and net exports). Other factors determine a country’s GDP growth and include stability of politics, environmental factors (global warming) and regional stability among others. According to Fischer (1993), a country’s GDP is also driven by the amount of spending the government does. Mankiw et al. (1992) support Fischer’s argument introducing the aspect of inflation in GDP growth arguing that inflation is the phenomena of rising trends of prices in a country. As the prices go up, citizens tend to spend a lot of their savings than before.

Multiple Regression Analysis Empirical Project