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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 might short and long term goals between a business and the government differ?
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how to find the relationship for a simple linear model?
Consider a Simple Linear Regression Model (SLRM) of the form y= a1+a2X+e where e ~ N(0,σ 2 )(Use the assumptions outlined in our class and available for review in the lecture note
Give the mathematical formula of calculate the slope of a line?
what are the econometric models supporting currency revaluation and their application
demand for tea, Y, are assumed to be affected by income of students, X. A simple linear regres-sion analysis was performed on 20 observations and the results were: Independent vari
anova model two qualitatlve var
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