Consider the Following Distributed Lag Model Is Serially Uncorrelated,and

question 5

Essay

Consider the following distributed lag model is serially uncorrelated,and X is strictly exogenous.
(a)How many parameters are there to be estimated between the two equations?
(b)Using the two equations of the model above,derive the ADL form of the model.
(c)There are five regressors in the ADL model,namely Yt-1,Xt,Xt-1,Xt-2 and the constant.Estimating the ADL model linearly will give you five coefficients.Can you derive the parameters of the original two equation model from these five estimates? Why or why not?
(d)What alternative method do you have to retrieve the parameters of the two equation model?

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Definitions:

Hydrogenation

The chemical process of adding hydrogen to an organic compound, usually to reduce or saturate organic molecules.

Stable Alkene

An alkene (hydrocarbon with carbon-carbon double bonds) that exhibits low reactivity due to its substituents or molecular structure.

Stable Alkene

An alkene that exhibits resilience against chemical reactions due to its specific structure, substitution pattern, or steric hindrance.

Dehydrogenated

Describes a chemical reaction in which hydrogen is removed from a molecule, often leading to the formation of double bonds or the introduction of oxygen atoms.