Reference no: EM1319183
Q1) Annual world crude oil production, 1880  1998 (millions of barrels)
Year

Mbbl

Year

Mbbl

Year

Mbbl

1880

30

1945

2595

1976

20188

1890

77

1950

3803

1978

21922

1900

149

1955

5626

1980

21722

1905

215

1960

7674

1982

19411

1910

328

1962

8882

1984

19837

1915

432

1964

10310

1986

20246

1920

689

1966

12016

1988

21338

1925

1069

1968

14104

1990

22100

1930

1412

1970

16690

1992

22028

1935

1655

1972

18584

1994

22234

1940

2150

1974

20389

1996

23380





1998

24441

Data table gives information on world crude production from 1880 to 1998.
a) Produce scatter plot that shows the relationship between years since 1800 and crude oil production. Comments on what you see.
(b) It seems that no single model will explain the relationship between these variables effectively, Produce a scatter plot of data from 1880 to 1972. (Make sure to use years since 1800!) Use transformation to liberalize data, and then do an inverse transformation to obtain either a power or exponential model that describe the relationship. Give explanation for your choice of transformation with suitable statistical evidence.
(c) Use your model from (b) to forecast crude oil production in 1974. How comfortable do you feel with this prediction? Support your answer with suitable statistical evidence.
d) Now make a scatter plot of data from 1982 to 1998 (again, use years since 1800). Determine a linear, power, or exponential model that explains the crude oil production during this time period.
(e) Use your model from (d) to forecast crude oil production in 2002. How comfortable do you feel with this prediction? Support your answer with suitable statistical evidence.