1.

Introduction
Gasoline is a commodity that has been
exploding over the past century throughout the
world. It was one of the byproducts sloughed of
at the beginning of the oil industry. The annual
consumption per country, per year has been on
the steady increase. Its price is also sensitive,
changing quickly in response to news cycles,
policy changes, and fluctuations in the world's
markets. So what exactly is gasoline? Gasoline is
a transparent liquid containing mainly hydrogen
and carbon, and, when burning, produces mainly
carbon dioxide and water. We use it every day to
get to and from work and home, and to run all
the errands of our daily lives. In this particular
research, we will focus on Vietnam gasoline price
and several main factors that afect its price.
There is a number of influencers on the price of gas
but world oil price, exchange rate and inflation rate
are finally chosen to test if they actually affect the
gas price greatly. Crude oil prices make up 71% of
the price of gasoline. The rest of what we pay at the
pump depends on refinery and distribution costs,
corporate profits, and Federal taxes. Usually, these
costs remain stable, so that the daily change in the
price of gasoline accurately reflects oil price
fluctuations. Normally, foreign exchange rates
affected by commodity price fluctuations so
throughout this research we will get to know if the
price is really affected by USD/VND exchange rates.
Last but not least, The price of oil and inflation are
often seen as being connected in a cause and effect

relationship. As the gas price moves up or down,

inflation follows in the same direction. The reason
why this happens is that gas is a major input in the
economy.
In conclusion, the ultimate purpose of this
research is to point out the relationship between
Vietnam gasoline price and its influential
factors . In the process of completing this report,
a lot of sources of were used to ensure the
accuracy and diversity of the content of the
paper.
2. Methodology
The procedures in which the data is collected and
processed to make our final conclusion are as follow:
2.1. Research question
What factors affect Vietnam gasoline price?
In this paper, we will examine the effects of some
variables, namely world oil price, USD/VND exchange
rates, inflation rate and dummy variable in 24
months from 2014 to 2015.
2.2. Population and sample

Population:
In this model, the population is Vietnam gasoline
price

Sample:
In order to ensure the accuracy of the model, we
have tried to collect the data on the dependent
variable Vietname gasoline price and 4 independent
variables: world oil price, USD/VND exchange rates,
inflation rate and dummy variable in 24 months

from 2014 to 2015. The sample of our study includes

12 observations
2.3. Sampling method, data collection
2.3.1. Sampling method
The data is collected within months from 2014 to
2015. Such time frame is decided to make sure that
there is enough numbers of observations.
2.3.2. Data collection
The data was collected from reliable sources from
the Internet such as: statistics websites, empirical
reports, online newspapers and numerous other
sources.
2.4. Procedures of processing data

Firstly, the data was gathered then sorted in a

chronological order from 2014 to 2015 using
Microsoft Excel.

Secondly, we use the software EViews version 7

to process and analyze the data by running the
regression equation, running new regression of
dropping variable, running the test for 3 errors of
multicollinearity,
heteroscedasticity,
and
autocorrelation.

Next, the hypothesis testing of t-tests and Ftests is conducted to test the significance of model
coefficients, whether to drop a specific variable,
whether there is a perfect linear relationship
between independent variables, whether the
variances of error terms is fixed (or homoscedastic),

and whether covariance between disturbances is

different from zero.

Finally, we draw the conclusion about the

significance of independent variables and the
existence of 3 error types in the model.