Economics Dynamics Problems 35

# Economics Dynamics Problems 35 - Introduction 19 book there...

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Introduction 19 book there were a number of occasions when I set up spreadsheets and investigated the property of some system and was quite surprised by the plot of the data. Some- times this led me to reinvestigate the theory to establish why I saw what I did. The whole process, sometimes frustrating, was a most satisfying learning experience. The scope of using spreadsheets for investigating recursive equations cannot be emphasised enough. But they can also be used to investigate recursive systems . Often this is no more difFcult than a single equation, it just means copying down more than one column. ±or example, suppose we have the system x t = ax t 1 + by t 1 y t = cx t 1 + dy t 1 (1.9) Then on a spreadsheet all that needs to be speciFed is the values for a , b , c and d and the initial values for x and y , i.e., x 0 and y 0 . Then x 1 and y 1 can be computed with relative addresses to x 0 and y 0 and absolute addresses to a , b , c and d .Given these solutions then all that needs to be done is to copy the cells down. Using
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## This note was uploaded on 12/14/2011 for the course ECO 3023 taught by Professor Dr.gwartney during the Fall '11 term at FSU.

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