VAR Unit root testing

[enduriel]

Dear All,

I am new to the forum and I am currently enrolled in a empirical methods course.

I have an upcoming exam and struggle to understand how to solve a problem set provided by the lecturer.

The guy requires us to compute the unit roots of VAR model using point estimates ourselves.

I have two variables and their point estimates. Using eigen values I have to compute and test for unit roots without using Eviews ofcourse.

Could someone please show me how to do that and write down which formulas I have to plug the numbers in...

It's just a very tough course and I fail to understand the maths behind this question.

I initally thought that I could compute them simply by dividing 1 by the point estimate and if I get 1 then there is unit root. I got told by the lecture that if the value is for example 2.5 this will not work. Currently I have PAt = 0.601; PBt = 0.327; PAt-1=0.003; PBt-1 = 0.501.

I would be grateful if one could help.
Regards