question archive a) Use the following models to answer the questions given below:
a) Use the following models to answer the questions given below:
Subject:EconomicsPrice: Bought3
a) Use the following models to answer the questions given below:
.......... (1)
............... (2)
......... (3)
i) Why would the estimation of the above functions by ordinary least squares give biased and inconsistent parameter estimates? (3 marks)
ii) Distinguish between the order and rank condition used to identify simultaneous equations. (3 marks)
iii) Derive the reduced form equations of the given model above. (7 marks)
iv) From the reduced form equations in (iii) above, examine the identification status of the three equations using the order and the rank conditions. (6 marks)
What are the implications of identification of a model? ( 1mark
