Research Design Proposal and Data Collection Managerial Decision Making MBA/510 The team proposal is to research and collect data on the background of unleaded gasoline's price fluctuations. This research proposal will help the team apply and analyze the collected data to better understand how gas prices work. When gas prices are on the rise it can be economically devastating. Therefore, business, government, and consumers always will keep a watchful eye on the fluctuation of unleaded gasoline.
87 octane grade gasoline is mostly used by the public on their privately owned vehicles. Organize business tends to use diesel fueled vehicles for their strength and economic benefits couple with low cost maintenance. Since the majority of vehicles in the USA belong to the public, a price increase will affect the greater part of the population in terms of numbers. The data to be collected will come from 30 gas stations representing 3 different companies. Collecting this data will encompass a period not to exceed 90 days of data collections and analysis.
The team will than compare and analyze the prices of gasoline from various communities of diverse income levels. Analysis of the data will be extensive enough to reveal its significance, and the methods of analysis used will be appropriate to unleaded gasoline. The extent to which the research criterion is met will be an indicator of the team's effort and success (Douglas, William, and Samuel, 2004). Many stakeholders involved in this type of project, but clearly three main stakeholders that will have significant influence on the results of the information collected. The primary stakeholders will be the three oil companies that are the subjects of the research. In most cases, they refine the oil into gasoline, distribute and market the product.
The second stakeholder will be the owners of the gas stations that have the most influence establishing the price. They will set a price competitive with local market pricing and will also consider all costs involved with getting the gasoline to market and overhead. The final stakeholder will be the researcher. This person is responsible for collecting and analyzing the data. As with the stakeholders, many end users are also involved in researching data. This group will receive the data set detail and can interpret and analyze the data as needed. Included in this group of customers could be; travel agencies, corporate travel groups and auto clubs.
These customers would probably use this information to develop reporting on gas prices for another end user. They would also focus primarily on a regional basis. Another customer, the household, would use the information on a more local basis. Their interest in this detail would be solely for household budgeting. Since nothing will be inferred from the data collected, the type of statistics used will be descriptive statistics.
Three different oil companies will be used to acquire the information needed. These three variables are considered nominal variables. According to Lind (2004), "a nominal level of measurement can only be classified or counted there is no particular order to the labels" (31-32). The oil companies will not be ranked in order of importance, the inclusion of their names will be used to document where the prices of the gas was retrieved from.
A sample set of the price of gas from 30 different stations will be used for each oil company. The term "exhaustive" is used to define collecting all data on a particular variable (Lind, 2004). For the purpose of this study, the sample of 30 stations is sufficient because the amount of data collected from every station an oil company owns would be overwhelming, time-consuming, and counter-productive.
Grade 87 octane will be the type of gas from which data will be collected. The varying price of gas is a quantitative variable because it can be measured. Lind (2004) defines a ratio level of measurement as having a zero point which is meaningful, and having the differences between two numbers being meaningful. Grade 87 octane will be classified as ratio level of measurement because it has a zero point ($0) which is meaningful because this would be the absence of price, it can be ranked from highest to lowest, and differences in the characteristics of the price of gas can be expressed as a numerical value.
The qualifications needed to collecting and analyzing data for the research of gasoline prices are individuals who demonstrate characteristics of a good researcher. Generally, one expects good research to be purposeful, with a clearly defined focus and plausible goals, with defensible, ethical, and repeatable procedures, and with evidence of objectivity.
The reporting of procedures their strengths and weaknessesshould be complete and honest. Appropriate analytical techniques should be used; conclusions drawn should be limited to those clearly justified by the findings; and reports of findings and conclusions should be clearly presented and professional in tone, language, and appearance (Copper, 2003). When choosing an individual to perform this type of research, they must be someone who has an established reputation for quality work. The research objective and its benefits should be weighed against potentially adverse effects.
The collecting of data can come from within the oil industry or an outside agency can be hired. One research that took place in Washington was when the Attorney General set out to investigate data to analyze factors that affect regional gasoline pricing in Washington.
There was an examination of the supply and demand conditions in Washington and an initial analysis of regional prices in nine areas. Both unleaded and diesel was included in the study. The Attorney General's Office contracted with an expert economist to review and analyze historical (secondary) and current (primary) pricing information. The Attorney General's Office cannot control gas prices, but it does have an important role to play in ensuring that prices are reached in a competitive environment and ensuring that prices are free of illegal manipulation.
The Attorney General contacted the Oil Price Information Service (OPIC) for data analysis on the pricing of unleaded gasoline. The Federal Trade Commission and the United States Department of Justice have also substantially increased efforts to investigate price gouging. The Reserves and Production Division of the Energy Information Administration (EIA) designs, develops, and maintains statistical and analytical information systems for domestic and international oil and gas reserves resources, production, costs, and prices.
The division performs data processing, analyses, short-term forecasting, modeling, and report preparation activities associated with oil and gas reserves, resources, production, costs, and prices. Research in any field needs to be an exact science. The data collect can and will affect the outcome of any research produced. Researching gasoline is no different. In researching the production and consumption of 87 octane gasoline, many restraints can affect the data and its collection. One constraint that will affect the data while researching 30 gas stations is the varying in price per gallon. This will affect the data collected because the price per on any given day will vary plus or minus 10 cent at any given gas station.
Because of this one will not be able to compare dollar amounts of gasoline sold. In addition, when comparing amounts sold over longer periods, the varying of prices per day will need to be accounted for. A second constraint that could potentially effect the data in researching 87 octane gasoline is the different areas in which the gas stations are located. Gas stations in poorer areas will potentially sell more 87 octane gasoline than gas stations in higher end areas. Generally, the more affluent residents of higher end areas purchase higher end cars such as Mercedes and Lexus.
These types of automobiles are required to use gasoline with higher octane ratings than 87. Residents of poorer areas typically will purchase lesser priced automobiles that will not require higher octane gasoline per the manufacturer. A third constraint that could potentially effect the data in researching 87 octane gasoline is time. Because of all the varying significant information concerning gasoline and it prices, could possible change multiple times in a day, it would be very important to get the data collected and analyzed immediately. It will need to be analyzed immediately so that the data doesn't become obsolete because of the various possible changes in the market. Methodology to collect data:
The actual procedure (methodology) followed to collect data needed was retrieved from msn autos Website and did a search for gas prices in California by typing in the zip codes. The info is updated everyday with the current gas prices for the area. The zip codes used to find the gas stations are: 94140, 92324, 94043, 92346, 92501, 92571, 90638, 90650. Interestingly, the gas was 40 cents higher in an area of higher income (San Francisco Bay) than areas of low income (Inland Empire).
Raw data for all samples Location/Store numberChevronLocation/Store Number76Location/Store NumberValero #7606$3.12 Bay Area Auto Care$3.20 Mountain View Valero$3.00 #0699$3.20 Mathida 76$3.20 Ultramar Station$3.00
EXXON CO$3.20 Union 76$3.20 Golden Gas and Market$3.02 #0306145$3.22 Unocal$3.20 Food and Fuel #23$3.04 #6377$3.28 El Camino Unocal$3.24 Quick Save #2$3.04 #20686$3.34 Los Altos 76$3.24 Ultramar 3785$3.04 Village Chevron$3.34 Palo Alto Unocal$3.24 Waterman Ultramar$3.10 Retail Facility #208$3.20 Unocal Mt. View, Ca.$3.32 Highland Ranch Valero$3.12 #20669$3.20 Redlands Unocal$3.06 Sunnyvale Valero$3.20 #8167$3.16 Rapid Gas #37$2.86 Valero #7669$3.20
Retail Facility #210$3.00 3315 14th st.$2.92 Valero #7864$3.20 #3673$2.90 7494 Indiana Ave.$2.98 Valero #3804$3.26 #6984$3.00 Baines Unocal$3.00 Valero #7230$3.26 #1417$3.00 Saulat 76$3.00 Valero #7542$3.26 #30291$3.06 Main Street Unocal$3.06 George Valero$3.32 Retail Facility #209$3.10 Blaine Union 76$3.10 Rancho Auto Service$3.34 Samir Bahouth$3.10 2128 S. Riverside Ave.$3.23 Valero #7528$3.34 #6969$3.02 Loma Linda 76$3.00 Inland Valero$2.94
#9125$3.08 1950 S. Waterman Ave.$3.08 Cedar Valero$3.00 #20772$3.08 1703 E. Washington St.$3.10 Riverside Ultramar$3.08 Chevron San Francisco$3.32 800 Folsom St.$3.33 Food and Fuel #24$3.00 #3535$3.34 Van Ness 76$3.35 GNG Liquor$3.00
#1512$3.34 Peter Papapietro$3.36 Orange Oil Company$3.00 #1522$3.34 2831 Cesar Chavez$3.40 Save on Valero$3.00
#2841$3.35 San Francisco Unocal$3.40 SSN Corporation$2.99 #0878$3.36 390 1st St.$3.44 Uni Mart$2.96 #0985$3.36 Unocal San Francisco$3.44 Lakeview Valero$3.00 Andretti Petroleum L$3.38 BP$3.50 Khan's Ultramar$3.03 #0142$3.60 Divisadero 76$3.50 So Co #3$3.04 #0034$3.70 BP #2$3.57 Valero 24/7$3.04
Reference: Cooper, D., and Schindler, P. S. (2003). Measurement. Business research methods (8th ed.). New York: McGraw-Hill Companies. Douglas, A. L., William, G. M., and Samuel A. W. (2004). Research in business. Statistical techniques in business and economics (12th ed.).
New York: McGraw-Hill Companies. Energy Information Administration "A Primer on Gasoline Prices." Retrieved July 6, 2007.
http://www.eia.doe.gov/bookshelf/brochures/gasolinepricesprimer/eia1_2005primerM.html Fortworth Gas Prices (n.d) Retrieved July 6th, 2007 from
www.fortworthgasprices.com/Forum_MSG.aspx?master=1&category=1056&topic=267957&page_no=6 - 40k Gas prices Retrieved on July 9th 2007 from: http://autos.msn.com/everyday/GasStations.aspx?m=1&l=1&zip=92571&x=19xy =10 Gasoline Statistics (n.d) Retrieved July 6th, 2007 from www.ccs.k12.in.us/chsteachers/MNesbitt/AP%20Stat%20Sem%202/BVD_Ch_24 additional_examples_key.doc http://www.atg.wa.gov/gasstudy.aspx. Retrieved July 6, 2007 Lind, D. (2005). Statistical techniques in business and economics (12th ed). New York: Mcgraw-Hill. Pps: 17, 21, 31, 32