Think of at Least Five Examples from Economics Where Theory

question 20

Essay

Think of at least five examples from economics where theory suggests that the variables involved are cointegrated. For one of these cases, explain how you would test for cointegration between the variables involved and how you could use this information to improve forecasting.

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Definitions:

Participants

Individuals who take part in a particular process, study, or event.

Confounded

Confusion or a mix-up, especially in experimental results, caused by unexpected variables affecting the outcome.

Experimenter Bias

A form of bias introduced by the expectations or beliefs of the experimenter affecting the outcomes of an experiment.

Flinch

A quick, involuntary movement or draw back, often from fear or pain.