Measuring Test The Stationary Of Data Essay

The ADF and PP unit root test results, indicated that, Agric growth, Exports, Infrastructure development, Intellectual Property Rights and Research & development are integrated of order one I(1) intercept and trends, that is, they achieved stationary after taking their first. But the other variable achieved stationery after their first difference I (1) none. Having ascertained the absence of I (2) variable in the series, the ARDL approach to co integration is now applied to the

IS-LM model can be used to show the effect of expansionary and tight monetary policies. A change in money supply causes a shift in the LM curve; expansion in money supply shifts it to the right and decrease in money supply shifts it to the

Also, this estimation allows the using of a lagged dependent variable to check whether there is a possible cointegration in the economic variables, with the possibility of one variable forecasting another (Campbell & Shiller, 1988). Including the lagged dependent variable can reduce the occurrence of autocorrelation arising

Additionally, I will also be testing for granger causality. In order to test for granger causality though we need to use variables which are stationary.

economy, five leading indicators can be observed. These include the stock market, inventory levels, retail sales, new housing starts, and the housing market. The two primary measures used for the stock market are the NASDAQ and S&P 500 indexes [figure 2A]. The S&P 500 index has steadily grown at a low rate over the past five years, and the NASDAQ index has grown at a faster rate. There is indication that the stock market began to plateau starting in the second quarter of 2015. Inventory levels, as seen in figure 2B, show growth through 2014, but began to decline starting in 2015. Retail sales [figure 2C] show a similar trend, as they showed steady growth through 2014, but show indications of plateauing, as growth declined in 2015. However, residential construction and housing show a different indication. New housing starts, shown in figure 2D, have steadily grown over the past five years, with a very slight decline in average growth rate in 2013. Housing prices within the U.S. have grown steadily since 2011 [figure 2E].

Considering the following regression model: BRi=β0++β1(Y)+β2(Z)+ui which connects the bank rate (BR) of Canada to foreign exchange rates(Y) and CPI(Z). In this model X1 and X2 are the corresponding independent variables exchange rates and CPI measured in decimals. There were three estimation methods that were used to estimate the model: The Durbin Watson test is used to test the presence of autocorrelation. The residual values from the regression analysis helps determine if there is a relationship between values that are lagged. The result of the Durbin Watson test lies between 0 and 4 and depending on the value it will show the presence or absence of autocorrelation. The value that is closer to 0 indicates that there is positive autocorrelation, 2 indicates that there is no autocorrelation and values approaching 4 indicate that there is negative autocorrelation. For the hypothesis testing I’ve used the F-Statistic testing, in the later section of the paper I will explain my findings and the results.

This discourages consumers and businesses from taking loans, and instead save money, as shown by the contraction in demand for money in Fig 1.1 from Q1 to Q2. This will lead to less money being circulated in the economy, with lower consumption and a contraction in investment by businesses, as shown in Fig 1.2. AD will therefore decrease and shift to the left from AD1 to AD2, shown in Fig 1.3, as consumption and investments are amongst the determinants for AD. With a left shift in AD, a new equilibrium point is established at B with a lower price level (APL2) and lower economic growth (Y2).

This essay will explain and illustrates the key mechanism behind the money multiplier and explore how monetary authorities can influence its size and affect the money supply in the economy. Firstly, an introduction on money measure will be presented. Secondly, the mechanism behind money multiplier will be presented by using equations to explain the cyclical changes in the multiple factor. Thirdly, the examination of the money multiplier in the current economic climate will be put forward. Fourthly, an explanation on the open market operation, discount window and the reserve ratio will be presented to convey the influence in the size of money supply. Finally, this essay will conclude with an overview of the essay.

An additional factor that will aid in the process of determining whether a country is in a state of recession or expansion is inflation rate. When the inflation rate is increasing, this implies that the economy is undergoing an economic growth. In Quarter 1, the inflation rate was 0.46%, which is considerably low when in comparison to Quarters 2-8. Moreover, Quarter 2 was 1.1%, which is a significant increment from the previous quarter. Furthermore, Quarter 3 was 1.03%, Quarter 4 was 1.15%, and Quarter 5 was 1.8% (US). Finally, Quarter 6 and Quarter 7 were relatively about 1.9% (US). Therefore, because inflation rates are increasing, the economy is in an expansion.

In the chart, you can see that 2010 was more of a steady year in the economy and GDP percentage. It almost stayed the same throughout the year with a slight increase from the first to second quarter, then a slight decrease and increase coming into the third and last quarters of the year.

Table 4.1 presents the panel unit-root test results. There are two groups of hypotheses that are involved here. In the first four methods, the null hypothesis is: there is panel unit-root and the alternative hypothesis is: there is no panel unit-root and the decision

Vietnam joined the World Trade Organization in January 2007 and transformed from a heavily indebted country to a low middle income one in 2010. After opening up the country’s economy to foreign investors, its GDP grew by 7.3% on average from 2001 to 2010. While Vietnam survived the global slowdown of 2008 quite well relative to its neighbors with GDP growing by 6.8% in 2010. In 2011, Vietnam has experienced persistently high inflation at 23%. The economic growth rate is no longer the

We first use Augmented Dickey Fuller unit root test to check stationarity of variables at their level and at their first difference. In Table 2, we list the results of tested integrated orders

There has been a long standing controversy among the economist about the validity of PPP (Purchasing Power Parity) in the long run. The parity reveals that prices in two different economies should be identical to each other when they expressed in terms of the same currency. It is a central building block in the monetary models of exchange rate determination. One of the most common practices, to test the validity of PPP is through unit root test of real exchange rate. In this paper unit root test has been done based on the data on Bangladesh and its major trading partner India, to see whether exchange rate has unit root or not. It has been found out that the PPP holds i.e. real exchange is not trend stationary in the

The Reserve Bank Of India’ Bulletin is a monthly publication. It not only provides information, but also results of important studies and investigations conducted by reserve bank are given. ‘The Report on currency and finance’ is an annual publication. It provides review of various developments of economic and financial importance.