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##### (Answered)-8.4 Using equation (8.32), determine and illustrate with a sketch the dynamic behaviour of y t...

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8.4 Using equation (8.32), determine and illustrate with a sketch the dynamic behaviour of yt when (y1 − φ0/(1 − φ1)) is negative and (a) φ1 > 1 and (b) φ1 −1. 8.5 Let C(L) = 1 − φ1 L and D(L) = 1 + φ2 L, where L is the lag operator and |φi | 1, i = 1, 2. (a) Verify that C−1(L) = (1 + φ1 L + φ2 L2 + φ3 L3 + ··· ). 1 1 (b) Find the inverse lag polynomial D−1(L).

Solution ID:10137849 | Question answered on 16-Oct-2016

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