You Collect Monthly Data on the Money Supply (M2) for the United

question 19

Essay

You collect monthly data on the money supply (M2) for the United States from 1962:12002:4 to forecast future money supply behavior.


where $L M 2$ and $D L M 2$ are the log level and growth rate of M2. (a)Using quarterly data, when analyzing inflation and unemployment in the United States,
the textbook converted log levels of variables into growth rates by differencing the log
levels, and then multiplying these by 400.Given that you have monthly data, how would
you proceed here?

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