# Econometric Model Assignment | Homework For You

Develop an econometric model to forecast unemployment. The data file USMacro_Quarterly contains data on the unemployment rate from the Federal Reserve Bank of St. Louis. A more detailed description is given in USMacro_Quarterly description.

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1. Plot a graph of unrate. Based on the plot, can you spot business cycles in the data?
2. Plot a graph of Dunrate (the first difference in unrate). Based on the plot, can you spot business cycles in the data?
3. Compute the first eight autocorrelations of unrate and Dunrate. Are both series persistent? Which series is more persistent?
4. Estimate an AR(2) model for unrate. Use that model to predict the unemployment rate in 2014:Q1.
5. Estimate an AR(2) model for Dunrate. Use that model to predict the unemployment rate in 2014:Q1.
6. In light of your answer to parts a), b) and c) above, which unemployment rate forecast is best ? The one from part d) or the one from part e)?

Question has already been answered, it requires STATA and do file commands along with answers. It is already up on course hero but I cannot open the answers. can someone help so I can just see how to go about the basic ideas? Get Economics homework help today

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