NIGERIAN REAL GROSS DOMESTIC PRODUCT ANALYSIS BY PRINCIPAL COMPONENT METHOD
Ette Harrison Etuk
Department of Mathematics
Rivers State University, Port Harcourt
Email: ettetuk@yahoo.com
ABSTRACT
The real (inflation adjusted) gross domestic product of Nigeria is studied here by Principal Component Method. A realization of the series from the first quarter of 2018 to the third quarter of 2019 is analyzed using minitab 17 software. Both the correlation matrix and the covariance matrix are used. Eigen analysis of both matrices suggest that the first three principal components are enough to explain variation in the data set. The correlation principal components involved all the items. The covariance principal components did not involve all the items which is a deficiency. For example, livestock, forestry, fishing, solid minerals, construction, transport, utilities, accommodation and food services, finance and insurance, professional scientific & technical services, administrative and support services and business services, public administration, human health and social services and arts, entertainment and recreation are not involved. This makes the method inferior.
Keywords: Nigeria, gross domestic product, correlation, covariance
