Oil Quality and Price

question 51

Essay

Oil Quality and Price
Quality of oil is measured in API gravity degrees--the higher the degrees API, the higher the quality. The table shown below is produced by an expert in the field who believes that there is a relationship between quality and price per barrel.

A partial Minitab output follows:




-{Oil Quality and Price Narrative} Determine the standard error of estimate and describe what this statistic tells you.

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Definitions:

Sierra Club

An environmental organization that promotes the conservation of natural environments and influences public policy through advocacy and education.

Externalities

Economic side effects or consequences that affect uninvolved third parties; can be either positive or negative.

Socially Optimal Price

A price point at which the social cost of producing a good or service is equal to the social benefit derived from its consumption, leading to an efficient allocation of resources.

Units

A standard measure or quantity used as a means of expressing or accounting for something, such as in production, sales, or comparison.