One Advantage of Forecasts Based on a VAR Rather Than

question 30

Multiple Choice

One advantage of forecasts based on a VAR rather than separately forecasting the variables involved is

• A)that VAR forecasts are easier to calculate.
• B)you typically have knowledge of future values of at least one of the variables involved.
• C)it can help to make the forecasts mutually consistent.
• D)that VAR involves panel data.

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Definitions:

Business Combination

The process of merging two or more entities into one, commonly through acquisitions, consolidations, or mergers.

Consolidated Balance Sheet

A financial statement that presents the assets, liabilities, and shareholders' equity of a parent company and its subsidiaries as a single entity.

Minority Shareholders

Shareholders who own less than 50% of a company's shares, often having limited control or influence over company decisions.

Intra-Entity Receivables

Amounts owed to a company by its own subsidiaries or divisions, representing internal transactions within a single entity.