Class Exercise: Collect data on inflation and unemployment rates in the U.S. for the quarterly periods in

Question:

Class Exercise: Collect data on inflation and unemployment rates in the U.S. for the quarterly periods in 1980–2007 and develop and estimate a VAR model for the two variables. To compute the inflation rate, use CPI (consumer price index) and use the civilian unemployment rate for the unemployment rate. Pay careful attention to the stationarity of these variables. Also, find out if one variable Granger-causes the other variable. Present all your calculations.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Basic Econometrics

ISBN: 978-0073375779

5th edition

Authors: Damodar N. Gujrati, Dawn C. Porter

Question Posted: