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With the aim of this project to observe the impact of oil price shocks on macroeconomic indicators, testing for causality between these variables will establish whether or not, oil price changes explain changes in other variables. To carry this out, the VAR/Block Exogeneity Granger Causality Test will be performed. This test will estimate whether the oil price variables will Granger cause the remaining variables in the equation. This is achieved by analysing the p statistic at the relevant significance level. In addition to this, pairwise Granger Causality tests will be estimated. This is when each variable is tested purely against another to see whether one directly Granger causes the other.
In the long-run framework, budget surpluses: A. should be run on a permanent basis since they boost saving and investment and stimulate economic growth. B. should be run whenever o
A bakery has fixed costs of $10 per day and variable costs of $1 per loaf. Its oven can handle up to 50 loaves a day and it is impossible to obtain additional capacity. Sketch the
Difference between mec and mei.
A firm's current profits are $1,300,000. These profits are expected to grow indefinitely at a constant annual rate of 3 percent. If the firm's opportunity cost of funds is 6 percen
What are between material and non-material progress? • Material progress considers to as economic growth. Growth is only one dimension of development. Growth doesn’t unavoidab
What impact will an unanticipated increase in the money supply have on the real interest rate, real output, and employment in the short run? How will expansionary monetary policy a
Assume the economy has a GDP of $11,500 billion. The unemployment rate is at 7.3% and has been slowly rising for the last 6 months. Inflation was at 2.3% one year ago but has sin
What is the impact on the economy if price ceiling or price floor were removed? Ans) Price ceiling is government system or laws setting price floors or ceilings that forbid the
Q. Determination of all the endogenous variables? Determination of all the endogenous variables in the AS-AD model Determination of P and Y: Prices and
One constraint in our economy is time. As a society, we make choices about the allocation of time between work and other pursuits. In the US, most workers are eligible for overtime
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