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Based on models of expectation
Models based on uncertainty about the future
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AGRICULTURAL MARKETING SERVICE assume assumption automobiles categories of consumption change in current change in price coefficients of expectations commodity component of income computed consumer unit consumption function current demand current income current price curve demand equation contains derived difference equation discussed distributed lags distribution of lag durable Durbin-Watson statistic effect elasticity of expectations estimates expectational equations expectational variables expected future expected normal income expected normal price factors Friedman hence illus income elasticity independently distributed indifference curves institutional rigidities iterative method Koyck's lagged values matrix measured income method of reduction multiple equation method Nerlove non-expectational variables obtained original demand equation original equation parameters past prices period permanent component permanent income hypothesis price and income reduced equation residual term serial correlation single equation method statistical substitute system of demand technological or institutional tion total consumption transitory components uncertainty uncorrelated variance variance-covariance matrix vector xt-l zero