Generate a set impulse response functions and discuss their economic interpretations. Be careful to state any identification assumptions that are implicit in your interpretation.
Question 1 The file sales.dta contains 157 weekly observations on sales revenues (sales) and advertising expenditure (adv) in millions of dollars for a large Midwest department store for 2005-2007. The weeks are from December 28, 2004, to December 25, 2007. (a)Estimate a VAR model of sales and advertising. Choose the lag length but be sure […]