Impact of Consumption and Investment on the GDP in Qatar 1990-2013 - Statistics Project Example

The Impact of Consumption and Investment on the GDP in Qatar 1990 ID Estimating a Multiple Regression Model (the Impact of Consumption and Investment on the GDP in Qatar 1990-2013) Introduction about the select topic Considering the growth aspect that each country is faced with, one needs to understand the different approaches that each country employs in the management of their affairs leading to better economic performance. The economic performance of any economy is rated through the study of the Gross Domestic Product GDP. The GDP depends entirely on the different economic activities that the countries engage in that will range from production activities, importation aspects, the development of different services within the borders and exportation aspect. All these products either developed within or imported from within contribute to the economic activities that yield to the GDP of any economy. Considering the topic selected the impacts that consumption and investment have on the GDP covers a wide range of economic aspects. These range from all activities that involve investing and all those that relate to consumption. The consumption aspect consolidates all consumption needs that range from consumption of oil products and other products. Understanding these and the employment of graphs will help one understand the impacts that each has had on the growth of the country for the years under consideration that is 1990 to 2013. The study covers these and details the description of the data, development of estimates, the discussion of the results and a conclusion that aims at creating a summary of the study and indicating the different achievements over the study conducted. Data description Considering the data identified, one learns that the consumption is reflected as the expenditure. It covers both the government expenditures and the expenditures of the different households. Combining the two results to the expenditure for the economy, which is analyzed in the work below? Understanding this helps in understanding the impact that the expenditure aspect had on the GDP for the different years under consideration. In the data collected, the consumption is provided in the percentage terms and in billions of Qatar’s local currency. These provided are as obtained from an online source on Qatar economic statistics and indicators. The data collected on the different investment aspects also provides information with regard to the investment opportunities for the country and their impacts to the economic performance of Qatar. Understanding this helps one understand the actual performance of the economy with the investments that the country engages in accounted for the GDP. The data collected on the GDP is also obtained from the same website and this indicates the GDP aspect on a constant price as per the National currency used within. The GDP indicates the performance of the economy from the years 1990 to 2013. Interpreting this data yields the table attached in the discussion of results column of the data attached. The data collected is then analyzed using different measures after considering the descriptive statistics for the three variables of consumption, investment and the GDP of Qatar. The GDP is because of different economic activities of which consumption and investment weigh most with each taking a good percentage in the different aspects engaged. Estimations The different estimations obtained through the model of multiple regression employed cover the understanding of the different coefficients applied in the regression model. In the estimation of a regression model for multiple factors, the three items all in the table are applied. These ranges from the intercept that is the GDP for the case and the two coefficients applied that are consumption and investment aspects. In developing these, one identifies the analysis of the variance to result into the table as attached below: ANOVA   Df SS MS F Significance F Regression 3 193780.081 64593.36034 645.5242941 2.7354E-19 Residual 19 1901.204738 100.0634073 Total 22 195681.2858       His indicates the regression aspect as three with a residual of 19 as per the frequency aspects. The SS indicates that of 193780.081 while the residual factor stands at 1901.204738. These represent the standard errors of each coefficient. These estimates play a vital role in developing a statistical relationship between the three variables of GDP, consumption and investment. Considering the standard table of coefficients,   Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 44.52359006 14.80150088 3.008045631 0.007231706 13.54369274 75.50348737 13.54369274 75.50348737 109.6631 1.15178956 0.257549716 4.472105735 0.000261211 0.612731811 1.690847309 0.612731811 1.690847309 97.2847 2.369256656 0.275214652 8.608759161 5.54509E-08 1.79322577 2.945287541 1.79322577 2.945287541 One learns that the coefficients indicate 1.15178956 for the first coefficient and 2.369256656 for the second aspect that represent consumptions and investments respectively. Understanding these estimates with the standard errors involved reveals the level of accuracy that the regression model has developed. Considering the different approaches that the economic players use to contribute to the development of the economy, the data applied in the graphs matches the needs for regression analysis. The different conditions required for the errors seem satisfied. Discussion of results The results of the data collected represented in a graph will appear as below: Graph representing changes in the consumption, investment and GDP levels for each year from 1990 to 2013: The graph above indicates an impact on the GDP. It indicates that the higher the consumption and the investment aspects the higher the GDP that the country’s economy will yield. The lower the investment and consumption aspect the lower the GDP of the economy. Following the years from 1990 to 2013, the GDP is highest in 2013 and lowest in 1990. These indicate that the level of consumption and investment were low at these earlier stages. As consumption and investment grew, the GDP grew further and hence the positive GDP. Consumption as developed by both the government and the individual households leads to positive development of the GDP. Government expenditures rely heavily on the different infrastructure projects that the country is engaging in and the expenditures in settling government obligations that range from salaries of the civil servants. The government expenditures grow based on the growth of the economy and the increasing number of projects that the government regularly engages in. the national income levels resulting from the taxes collected by the government affects the expenditures that eth government incurs either positively or negatively. Understanding these elements helps one understand the tax obligations of the country. The government will tax more to have more money to meet its expenditure needs. The failure of the taxes to meet the expenditure obligations of the government leads to the government-engaging national debt into the financing aspects. The national debt could result from the international monetary fund or different facilities willing to fund the government. Other contributors to the expenditure aspect of consumption are the individual taxpayers. These consider their household income to spend on their needs and wants. The needs of the taxpayer many at times exceed their disposable income. Disposable income refers to eth balance that the taxpayers retain after deducting their savings from their incomes. This balance is normally spent based on the needs of the household. The higher the disposable income of a household the higher the expenditure levels for the individual taxpayers, the higher the economic growth that the country will enjoy. The government therefore needs to reduce on their taxes and input the levels of income that will leave the households with adequate disposable income for the expenditure through which the economy grows. Understanding these aspects helps one understand the different economic factors that contribute to the growth of the GDP of a country. Considering the GDP and the relationship that exist between the three items, one learns that the GDP is influenced by a number of factors that differ that explains why the percentage of both consumption and investment do not meet the actual GDP requirements. The difference applies to other factors that affect the GDP of an economy and these include the gross national saving aspects that eth country considers closely in its GDP growth. The national savings levels indicate the values that the government has saved as part of the income that they generated for the financial year. The income considered for the government relates to the taxes. The expenditure made on the taxes leaves behind a saved income that the government saves for future projects. Understanding all these aspects and their effect to the GDP helps in understanding the business effects and the actual GDP changes that the different economies experience on a regular basis. Conclusion Considering the data collected from the different online sources, the presentation of the data as represented above will guide in understanding the different grounds through which the economic situation keeps changing. The bid to understand the economic aspects GDP, consumption and investments, one considers the proper understanding of how the two aspects of consumption and investment that act as the independent variables for the study which GDP acts as a dependent variable. Considering the study conducted and the results obtained, it is evident that the GDP of an economy relies on the consumption rate of their government and the households in addition to the investment aspects that the government would apply to dealing with the economic development aspect. References Economic Watch, (n.d). Qatar Economic Statistics and Indicators. Retrieved from http://www.economicwatch.com/econmic-statistcis/country/Qatar/ Read More