ARMA Model Interpretation

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leeinsydney
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Joined: Sun Jun 17, 2012 6:16 pm

ARMA Model Interpretation

Postby leeinsydney » Sun Jun 17, 2012 6:24 pm

Hi guys

Could anyone please help me to re-write the following ARMA model into an equation? i.e. I am struggling how to use the AR, MA parameter values?
Does AR(1) in Eviews mean "Investment(-1)" and AR(2) is "Investment(-2)? I tried to find the answer by reading the manual but couldn't figure it out.

Thank you very much.
Daniel

Investment= C(1)*FINANCE(-2) + [AR(1)=C(2),AR(2)=C(3),MA(1)=C(4)]
Investment= 0.36*FINANCE(-2) + [AR(1)=0.2623,AR(2)=0.3905,MA(1)=0.9721]

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