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Ka-fu WongUniversity of Hong Kong

EViews Commands that are useful for Assignment #2

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Download and open the Excel file containing the data

We are going to use Canada-US real exchange rate as an example.

Dated observations from 1970:01 to 2006:11

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Enter or read data in EviewsFile > New > Workfile

3. Click OK.

1. Choose “Monthly”.

2. Specify 1970:01 and 2006:11

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Enter or read data in Eviews Choose Quick>Empty Group(Edit Series)

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Enter or read data in Eviews Key in data

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Enter or read data in Eviews Copy the data from Excel (B16:B458 together) to the Workfile

Default series names

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Renaming the seriesFirst minimize the data sheet

Highlight ser01 and right click mouse, and choose rename

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Rename the series ser01

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Check if the variable names has been changed

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Save data and results frequently to avoide loss of dataFile>SaveAs

Enter rer1.wf1

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Plot a line graph of the data (against date)and call it Figure1

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Double click figure1 to see the plot

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Generate the variable TIME and its relativesTIME=1 for 1970m01 and 2 for 1970m02, etc.

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Generate the variable TIME and its relativesTIME2, TIME3, TIME4, TIME5

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Select sample from 1970m01 to 2000m12 for regression analysis (fitting the trend line)

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Fit a linear trend using Least Squares and put the result to Table1

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Double click table1 to see the regression result

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Fit Polynomial trend line of various degree (up to 5) using Least Squares and put the result to corresponding tables.

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Fitting an exponential trend and put result to Table6

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Plot (in-sample) residuals, fitted values and actual values, and put them in corresponding figures (FigureA?)

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Generate a new variable containing the historical values of rer from 1970:01 to 2000:12

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Specify the sample to create out-of-sample forecast

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Produce a forecast for the sample period 2001m01 to 2006m11 using the Table1 regression results

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Generate the upper bound and lower bound of 95% confidence interval.

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Continue to obtain forecast, and confidence bound for the forecast using other trend models.

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Change the sample to 1970m01 2006m11, for plotting actual value and forecast together

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Plot the historical values, forecast, confidence interval and the actual value during the forecasting period.

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Double click figureb1 to see the plot

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Fix the sample and compute the sqaured forecast errors based on different models.

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Fix the sample and compute the sqaured forecast errors based on different models.

Create a vector “A” to save the mean squared errors.Save the mean squared errors to the vector

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Double click “A” to see the mean squared forecast errors from different models.

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Note limitation of EViews 4.1 student version

There is a limit on how many variables we can create in student version.

When I tried to run 6 regressions, and create the 6 forecast, 6 confidence bounds, 6 squared forecast errors all in one go, I got an error message “You have exceeded the data capacity of the Student Version.” I have to delete some variables before I could complete all the analysis I wanted to do.

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