Explain the inflation rate, Econometrics

Assignment Help:

The following regression was estimated to explain the inflation rate in the USA.  The data set contains annual observations from 1970 to 2010.

      Inft  =  2500 +   50*Xt  +   0.4Inflt-1

    se(B)                (5.0)        (0.002)             R2 = 0.92

where Inft is the inflation rate in a given year Xt is the growth in money supply in the same year

a.  Suppose this model represents a Koyck lag structure.  Find the 1st, 5th, and 10th lag coefficients on Xt.

b. If this was a forecasting model, exlpain what  AR(3) and MA(4) models would look like (separate not ARMA)

c.  Now assume you have the same time series data for 4 countries (USA, Canada, England, Japan).  Explain what would a fixed effects model look like, and how would it improve on the basic model?.


Related Discussions:- Explain the inflation rate

Explain the term volatility clustering, Problem: (a) Write down the equ...

Problem: (a) Write down the equation for symmetric GARCH and clearly explain its components. (b) Explain the term ‘volatility clustering'. (c) How would you model leverag

HR, the following are the weekly amounts of welfare payments made by the fe...

the following are the weekly amounts of welfare payments made by the federal government to a sample of six families: $139, $136,$130,$136,$147and$136.what is the range

Calculate expected profit and decision tree, It was shortly before noon. Mr...

It was shortly before noon. Mr. Zhi-Long Chen, director of Overnight Delivery Operations at Capital Crab and Lobster, Inc.(CCL) in Washington DC, anxiously watched the Weather Chan

Nonlinear specification and dummy variables, Suppose you have a model of ca...

Suppose you have a model of capital investment by a U.S. rm. Imagine that yt, x1t and x2t are annual measures of investment, lagged pro t, and lagged capital stock, all in real do

#title.MULTICOLINEARLITY, HOW TO USE CORRELATION OF THE OFF DIAGONAL ELEMEN...

HOW TO USE CORRELATION OF THE OFF DIAGONAL ELEMENTS OF THE COVARIANCE MATRIX TO DETECT MULTICOLINEARLITY

solutions of closely-defined customer group, Define McKinsey & Company's p...

Define McKinsey & Company's present "core competence" in terms used by Hamel & Prahalad and state how it fits with McKinsey's longer term vision. Answer) McKinsey an

Quantile regression coefficients, Consider the study of the effect of publi...

Consider the study of the effect of public-sponsored training programs. As argued in public programs of training and employment are designed to improve participant's productive ski

Discuss the criteria of the evaluation framework, Question 1: Explain t...

Question 1: Explain the main drivers of globalisation and ascertain whether they have helped to reduce the gap between the rich and the poor countries. Question 2: Disc

Explain what is meant by the term regression, (a) Explain what is meant by ...

(a) Explain what is meant by the term regression. (b) Describe the justification for the inclusion of a disturbance term in a regression analysis. (c) With appropriate exa

Production function and general equilibrium, Production Functions, Labor Ma...

Production Functions, Labor Markets, and a Small Open Economy. In 2007, the Icelandic economy was in general equilibrium, the supply of labor was a positive function of the real

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd