Micro Paper B: Forecasting Consumer Expenditure

 so all of the instructions are clearly in material 1. to open the data file, which you need to have Eviews and run the data. the thing you need to write about is 1. Build a forecasting model (one equation or more). Estimate the model. Correct for serial correlation and heteroskedasticity as you think appropriate. Explain what you have done, and why, addressing your explanation to a more senior econometrician. 2. Forecast real demand in your sector for 2003. (Remember that you may not use any 2003 information.) Also provide confidence intervals for your forecast. Explain your forecast to a senior policy manager who is not an econometrician. Since you know the actual 2003 outcome for your sector comment, briefly, on how well your forecast turned out. 3. Forecast real demand for your sector for 2004. (Remember that you may not use any 2003 information.)