Introduction:

This report deals with the changes in the commodity prices before and after the
deregulation of the Petroleum products (which was done on 26 th July 2010, i.e. 27th week). The
Commodities taken for the study are Rice, Maize, Milk, Moong Dal, Masur Dal, Arhar Dal, Potato,
Onion, Banana, Lemon, Petrol and Cashew nut.

Data:
The following data shows price indices of the commodities keeping the 2004 -05 as the
base year. The data is taken from website of economic advisor; these show price indices of each
commodity in 2010 for each week and are not actual prices. Here it shows data of only 30 weeks
and for Rice, Maize, Milk and Onion.

week Rice Milk Maize Onion

1 164.30 157.60 154.20 278.50
2 164.50 157.50 154.20 275.50
3 165.00 157.50 154.20 268.60
4 164.70 157.80 153.80 262.70
5 165.20 157.80 154.20 266.90
6 164.30 157.80 153.90 265.60
7 164.00 158.30 153.20 260.90
8 164.10 159.90 154.00 241.60
9 164.10 165.00 153.00 222.90
10 163.60 164.80 153.10 192.50
11 163.40 165.90 152.80 172.20
12 163.30 167.40 152.80 163.70
13 163.10 170.50 153.50 156.80
14 163.70 170.50 153.20 155.00
15 163.40 170.50 153.00 152.10
16 163.40 170.50 152.30 145.10
17 163.60 170.50 153.90 139.80
18 163.70 171.90 153.10 144.10
19 163.60 171.90 152.00 138.70
20 163.50 171.90 151.80 140.60
21 163.30 171.90 153.10 135.50
22 163.40 171.90 153.80 136.20
23 163.90 171.90 155.60 142.20
24 164.70 171.90 157.20 153.90
25 163.90 171.90 157.50 152.40
26 164.50 171.90 161.10 152.10
27 164.70 171.90 160.50 151.70
28 166.60 174.70 163.70 164.10
29 166.80 175.70 166.30 164.20
30 166.30 175.50 169.70 160.10
Analysis of the Data:
The above mentioned data’s actual length is 52 entries for each of 12 commodities,
namely are Rice, Maize, Milk, Moong Dal, Masur Dal, Arhar Dal, Potato, Onion, Banana, Lemon,
Petrol and Cashew nut. Then the relationship between prices before and after deregulation of
the fuel prices is checked using Chow test. Then using right tailed F probability distribution
function to check for the significance of the Chow test done.

Result:
The obtained result is give as follows.

Commodities Difference before and after the

deregulation of fuel prices
Rice Exists
Maize Exists
Milk Exists
Moong Dal Exists
Masur Dal Does Not Exists
Arhar Dal Does Not Exists
Potato Exists
Onion Exists
Banana Exists
Lemon Exists
Petrol Exists
Cashew nut Exists

Conclusion:
From the above obtained result we can clearly see that except Moong Dal and Masur Dal
all other commodities were affected by the deregulation of the fuel prices.

References:
 http://eaindustry.nic.in/