Command not found/Install missing gem binaries with 'bundle install' using autotest

I am totally new to RoR. I am following Michael Hartl's book. I am not able to make autotest run. Please suggest what's going wrong and a solution to fix it.

When I run 'autotest' at command line inside Rails project directory i get following:

-bash: autotest: command not found

When I run 'bundle exec autotest' I get following:

 bundler: command not found: autotest
 Install missing gem binaries with `bundle install'

Here is the Gemfile

source 'http://rubygems.org'

gem 'rails', '3.0.3'
gem 'sqlite3-ruby', :require => 'sqlite3'

group :development do
gem 'autotest'
gem 'rspec-rails', '2.4.1' 
end

group :test do
gem 'rspec', '2.4.0'
gem 'webrat', '0.7.1'
end

Here is the output from 'gem list'

abstract (1.0.0)
actionmailer (3.0.7, 3.0.6, 3.0.3, 2.3.5, 1.3.6)
actionpack (3.0.7, 3.0.6, 3.0.3, 2.3.5, 1.13.6)
actionwebservice (1.2.6)
activeresource (3.0.7, 3.0.6, 3.0.3, 2.3.5)
activesupport (3.0.7, 3.0.6, 3.0.3, 2.3.5, 1.4.4)
acts_as_ferret (0.4.3)
arel (2.0.9)
autotest (4.4.6)
autotest-fsevent (0.2.5)
autotest-growl (0.2.9)
autotest-notification (2.3.1)
autotest-rails-pure (4.1.2)
builder (2.1.2)
bundler (1.0.12)
capistrano (2.5.2)
cgi_multipart_eof_fix (2.5.0)
configuration (1.2.0)
daemons (1.0.10)
diff-lcs (1.1.2)
dnssd (0.6.0)
erubis (2.6.6) 
fastthread (1.0.1)
fcgi (0.8.7)
ferret (0.11.6)
gem_plugin (0.2.3)
heroku (2.0.4)
highline (1.5.0)
hpricot (0.6.164)
i18n (0.5.0)
launchy (0.4.0)
libxml-ruby (1.1.2)
mail (2.2.19, 2.2.15) 
mime-types (1.16)
mongrel (1.1.5)
mysql2 (0.2.7)
needle (1.3.0)
net-scp (1.0.1)
net-sftp (2.0.1, 1.1.1)
net-ssh (2.0.4, 1.1.4)
net-ssh-gateway (1.0.0)
nokogiri (1.4.4)
notifier (0.1.3)
polyglot (0.3.1)
rack (1.2.2, 1.0.1)
rack-mount (0.6.14)
rack-test (0.5.7)
rails (3.0.7, 3.0.6, 3.0.3, 2.3.5, 1.2.6)
railties (3.0.7, 3.0.6, 3.0.3)
rake (0.8.7, 0.8.3)
RedCloth (4.1.1)
redgreen (1.2.2)
rest-client (1.6.1)
rspec (2.5.0, 2.4.0)
rspec-core (2.5.1, 2.4.0) 
rspec-expectations (2.5.0, 2.4.0)
rspec-mocks (2.5.0, 2.4.0)
rspec-rails (2.5.0, 2.4.1)
ruby-openid (2.1.2)
ruby-yadis (0.3.4)
rubygems-update (1.7.2)
rubynode (0.1.5)
spork (0.8.4)
sqlite3-ruby (1.3.2, 1.2.5, 1.2.4)
sys-uname (0.8.5)
term-ansicolor (1.0.5)
termios (0.9.4)
test_notifier (0.3.6)
thor (0.14.6)
treetop (1.4.9)
tzinfo (0.3.27, 0.3.26)
webrat (0.7.1)
xmpp4r (0.4)
ZenTest (4.5.0)