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Question 1:
a) Explain what is a VAR giving an example both in the form of an equation and matrix. Discuss its benefits and limitations.
b) How can we estimate a VAR involving equations having a contemporaneous feedback term?
c) Distinguish between variance decomposition and impulse response functions.
Question 2:
(a) What are the two types of non-stationarity that exist and show how one of them can be made stationary?
(b) How do we test for a unit root?
(c) What does it mean when two variables are cointegrated?
(d) Using the Engle-Granger approach show how parameters can be estimated in cointegrated systems.
how weather affect the change in supply?
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Derive marginal benefit of reducing principal balances
Y1=Y21Y2+Bx+U1 Y2=Y21Y1+U2 First equation is demand and second is supply equation,can first equation be identifiable outline the method
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what is the case of autocorrelation
a) Design a simple econometric project to identify the factors that affect the demand for a good or service of your preference. Estimate the significance of these factors using mu
examples of economic relationships
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