The longest lag monetary policy suffers is the ________ lag

To estimate dynamic causal effects, your textbook presents the distributed lag regression model, the autoregressive distributed lag model, and a quasi-difference representation of the distributed lag model with autoregressive errors

Using a simple example, such as a distributed lag model with only the current and past value of X and an AR(1) model for the error term, discuss how these models are related. In each case suggest estimation methods and evaluate the relative merit in using one rather than the other. What will be an ideal response?

The demand for most products is likely to be

a. more elastic in the long run than in the short run. b. less elastic in the long run than in the short run. c. equally elastic in the short and long run. d. equally inelastic in the short and long run.