Prof. Bryan Caplan

bcaplan@gmu.edu

http://www.gmu.edu/departments/economics/bcaplan

Econ 345

Fall, 1998

HW#3

The workfile you downloaded for hw#2 contains all of the data you need for this assignment.

Comment on each of your results and print them. Is the coefficient positive or negative? Significant at the 5% level or not? What are your R2's?

  1. Use the Genr menu to create percent-change versions of Nominal GDP, Real GDP, and M2. Then try the following regressions:
  1. Percent change in Real GDP on percent change in Nominal GDP.
  2. Percent change in Nominal GDP on percent change in M2.
  3. Percent change in Real GDP on percent change in M2.
  1. Use the Genr menu to define lags of the percent-changes of Nominal GDP, Real GDP, and M2. Then try the following regressions:
  1. Percent change in Real GDP on percent change in Nominal GDP and lagged percent change in Nominal GDP.
  2. Percent change in Nominal GDP on percent change in M2 and lagged M2.
  3. Percent change in Real GDP on percent change in M2, lagged percent change in M2, percent change in Nominal GDP, and lagged percent change in Nominal GDP.