Question: 4) Estimate a VAR assuming the above structure but in the long run. (7 marks) 5) Based on these assumptions in (4) produce (in graphs)

4) Estimate a VAR assuming the above structure but in the long run. (7 marks) 5) Based on these assumptions in (4) produce (in graphs) and comment the impulse response functions. (6 marks) 6) Based on these assumptions in (4) produce (in tables) and comment the variance decompositions. (5 marks) 7) Estimate a VAR assuming that Estimate a VAR assuming that in the short run a structural demand shock affects contemporaneously all variables apart from the inflation, an inflationary shock affects contemporaneously all variables apart from growth rate, while a monetary policy shock affects all variables but only one quarter after. (7 marks) 8) Based on these assumptions in (7) produce (in graphs) and comment the impulse response functions. (6 marks) 9) Based on these assumptions in (7) produce (in tables) and comment the variance decompositions

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