Equation estimate

Dependent Variable: GRDP

Method: Least Squares
Date: 05/02/19 Time: 10:56
Sample: 1 29
Included observations: 29

Variable Coefficient Std. Error t-Statistic Prob.

C -260.3119 126.9010 -2.051299 0.0504

CPI 0.005307 0.000422 12.56517 0.0000
IMPORTS 25.01148 2.658338 9.408691 0.0000

R-squared 0.996254 Mean dependent var 4185.731

Adjusted R-squared 0.995965 S.D. dependent var 2384.711
S.E. of regression 151.4718 Akaike info criterion 12.97637
Sum squared resid 596536.1 Schwarz criterion 13.11782
Log likelihood -185.1574 Hannan-Quinn criter. 13.02067
F-statistic 3457.054 Durbin-Watson stat 0.404833
Prob(F-statistic) 0.000000

Correlation matrix:

CPI IMPORTS
CPI 1.000000 0.965069
IMPORTS 0.965069 1.000000

There is problem of multicollinearity between CPI and imports. So we have to

drop one variable and make new model and estimate it.
Estimate new equation:
Dependent Variable: GRDP

Method: Least Squares

Date: 05/02/19 Time: 11:13

Sample: 1 29

Included observations: 29

Variable Coefficient Std. Error t-Statistic Prob.

C 839.8438 101.5513 8.270145 0.0000

CPI 0.009143 0.000228 40.11480 0.0000

R-squared 0.983498 Mean dependent var 4185.731

Adjusted R-squared 0.982887 S.D. dependent var 2384.711

S.E. of regression 311.9587 Akaike info criterion 14.39009

Sum squared resid 2627592. Schwarz criterion 14.48439

Log likelihood -206.6563 Hannan-Quinn criter. 14.41962

F-statistic 1609.197 Durbin-Watson stat 0.281081

Prob(F-statistic) 0.000000

Correlation matrix:
CPI
CPI 1

Now we have to drop cCPI and estimate it

Estimate new equation:
Dependent Variable: GRDP
Method: Least Squares
Date: 05/02/19 Time: 11:38
Sample: 1 29
Included observations: 29

Variable Coefficient Std. Error t-Statistic Prob.

C -1544.911 196.1946 -7.874382 0.0000

IMPORTS 57.24720 1.817573 31.49651 0.0000

R-squared 0.973504 Mean dependent var 4185.731

Adjusted R-squared 0.972523 S.D. dependent var 2384.711
S.E. of regression 395.2950 Akaike info criterion 14.86361
Sum squared resid 4218970. Schwarz criterion 14.95791
Log likelihood -213.5224 Hannan-Quinn criter. 14.89315
F-statistic 992.0301 Durbin-Watson stat 0.142196
Prob(F-statistic) 0.000000

CORRELATION MATRIX:
IMPORTS
IMPORTS 1.000000
Dependent Variable: CPI
Method: Least Squares
Date: 05/02/19 Time: 11:59
Sample: 1 29
Included observations: 29

Variable Coefficient Std. Error t-Statistic Prob.

C -242035.6 34252.77 -7.066163 0.0000

IMPORTS 6073.640 317.3223 19.14029 0.0000

R-squared 0.931359 Mean dependent var 365956.7

Adjusted R-squared 0.928817 S.D. dependent var 258667.0
S.E. of regression 69012.86 Akaike info criterion 25.18845
Sum squared resid 1.29E+11 Schwarz criterion 25.28274
Log likelihood -363.2325 Hannan-Quinn criter. 25.21798
F-statistic 366.3507 Durbin-Watson stat 0.168263
Prob(F-statistic) 0.000000

R SQUARED (ORIGNIAL) (1) = 0.996254

R SQUARED (2) =0.931359

R(1)>R(2)
THERE IS NO PROBLEM OF MULTICOLLENEAIRY.