The data file inflation contains quarterly observations on the inflation rates in Germany and France from 1990Q1 to 2014Q4. For any hypothesis tests in the following questions, use a 5\% significance level.

a. Plot each of the series and comment on the plots.

b. Use unit root tests, checks for serial correlation in the errors and significance of coefficients to specify and estimate an equation relating Germany's current inflation rate to its past rates.

c. Use unit root tests, checks for serial correlation in the errors and significance of coefficients to specify and estimate an equation relating France's current inflation rate to its past rates.

d. Are the inflation rates in France and Germany cointegrated?

e. Specify and estimate an equation relating Germany's current exchange rate to past exchange rates in France and Germany.