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Problem 1:
(a) Using examples explain the concept of cointegration.(b) Explain the term ‘stationarity' and its importance.(c) Differentiate between stochastic and deterministic trends?
Problem 2:
Write short notes on the following: (a) Unit root tests (b) 3 S's (c) Spurious regression (d) Dummy variable trap (e) CLRM assumptions
the demand for blankets has been estimated y^=0.5-1.5x2+3.0x3
In a year, weather can impose storm damage to a home. From year to year the damage is random. Let Y be the dollar value of damage in a given year. Assume that 95% of the year's Y=$
(a) What is a white noise process? (b) Distinguish between exogenous and endogenous variables, using examples. (c) What do you understand by simultaneity bias and can OLS
demand function(qd)=650-5p-p2 where p=10
Probelm: (a) Differentiate between homoscedasticity and heteroscedasticity. (b) Outline the reasons why the variances of disturbance term may vary. (c) Given the 3 observ
when is an econometric model said to be simple and naive
The attached Eviews results are for a model who has a professional career (dependent variable = pro (1 if respondent has a professional career, 0 otherwise). The data is the 1979 c
given the formula for f statistic prove that by using the f statistic you can derive this formula
a) Explain what is calculated by a correlation coefficient. b) Why do economists commonly find regression a more useful tool than correlation? c) In a sample of 102 men the corre
What is the rival principle of distribution? What are the impacts of ethics and morals on the rival principles of distribution?
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