You have estimated the following HPI stochastic process model dHPI(t) = a + BHPI(t-1)+ yo(t)dz 0.0500 0.9500 α В X 0.05 0 0.03 You have a home valued at time 0 of $250,000 Question 1 Show the quarterly home price based on this information 0.25 dt Question 2 What econometric method would you use to estimate this model? What is this kind of model called?

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You have estimated the following HPI stochastic process model
DHPI(t) = a + BHPI(t-1)+ yo(t)dz
%3D
0.0500
0.9500
0.05
0.03
You have a home valued at time 0 of $250,000
Question 1
Show the quarterly home price based on this information
dt
0.25
Question 2
What econometric method would you use to estimate this model?
What is this kind of model called?
Transcribed Image Text:You have estimated the following HPI stochastic process model DHPI(t) = a + BHPI(t-1)+ yo(t)dz %3D 0.0500 0.9500 0.05 0.03 You have a home valued at time 0 of $250,000 Question 1 Show the quarterly home price based on this information dt 0.25 Question 2 What econometric method would you use to estimate this model? What is this kind of model called?
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