Abstract

This study employed regression analysis to investigate the casual relationship between gross domestic product and personal consumption expenditure of Nigeria using data from 1994 - 2007. A non insignificant value of 0.0514 was obtained as a slope coefficient indicating that an increase in gross domestic product has no significant effect on the personal consumption expenditure of Nigeria. This was further evidenced by the value of the coefficient of determination which was only 0.035 implying that the gross domestic product only explained about 3.5% of the personal consumption expenditure of Nigeria.

Key words: Causal relationship, coefficient of determination, gross domestic product, personal consumption expenditure, investment, government spending, consumer price index, implicit price deflator.