TNAG-0635-FCO40-783-Supplies-of-electricity-for-Hong-Kong-1977 — Page 86

reflected in the equation it was decided to use the

lower GDP forecast as a means of reflecting the once-

and-for-all jump in energy prices which may not be

fully picked up otherwise. The annual GDP growth rates

are therefore :

1977

1978

8%

胡路

6%

1979...

6%

1980

1981

1982

6%

1983

6%

1984

1985

1986

1987

(d) Forecasts

Using the assumptions previously discussed for the

independent variables, and the appropriate equation, the medium forecasts shown in Table 1 (below) were

produced.

Lower & higher forecasts were then made using the

same assumption for the explanatory variables but

different figures for income elasticity. In each case

one standard error on either side was taken, giving an income elasticity of 1.5 (lower) and 2.0 (higher).