Consider the following bivariate VAR(1): y_t=A_1 y_(t-1) u..4@0.0&0.3)] Now, consider the effect at time t=0,1,2,3 and 4
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Consider the following bivariate VAR(1):
y_t=A_1 y_(t-1) u..4@0.0&0.3)] Now, consider the effect at time t=0,1,2,3 and 4 of a unit shock on y_2t at time 0. Plot the impulse response functions of y_1t and y_2t to a unit shock of y_2t.
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