Consumption Growth - Quadratic Loss - Estimation - Economics Assignment Help

Assignment Task :

Instructions. Please type your answer key before turning it in. Donít forget to include your name and to include every graph/output that is requested in this activity.

f. Are your residuals white noise? From your estimation exercises, paste your residuals of both of your estimation exercises here and explain why they appear to be white noise or not.

g. Report both the AIC and SIC of your models. Based on each of these criterions (AIC and SIC), which model should be preferred ?

h. From parts (e), (f) and (g), there should be a model that should be statistically preferred to the other one. Under the assumption of quadratic loss (means you can use the conditional mean as the optimal forecast) use the best model to forecast gc for the years 2018 and 2019. Select a dynamic forecast (as done in the videos). Compare your forecast to the actual growth rates in consumption that were observed in 2018 and 2019. Paste your forecast diagram here and then type the forecasted values.

i. Refer to your forecast for 2018 (imagine you are in 2017 providing the forecast for year 2018). Let Y be the random variable consumption growth in year 2018 (gc2018). Given the conditional mean and standard deviation of your forecast, Önd the level of the growth rate y0 such that the following holds P [Y  y0] = 10% and then explain the meaning of such probabilistic statement. Assume that the innovation "t is distributed normally.

This Economics Assignment has been solved by our Economics Experts at My Uni Paper. Our Assignment Writing Experts are efficient to provide a fresh solution to this question. We are serving more than 10000+ Students in Australia, UK & US by helping them to score HD in their academics. Our Experts are well trained to follow all marking rubrics & referencing style.

Be it a used or new solution, the quality of the work submitted by our assignment experts remains unhampered. You may continue to expect the same or even better quality with the used and new assignment solution files respectively. There’s one thing to be noticed that you could choose one between the two and acquire an HD either way. You could choose a new assignment solution file to get yourself an exclusive, plagiarism (with free Turnitin file), expert quality assignment or order an old solution file that was considered worthy of the highest distinction.