Econometrics involves using computer analysis and statistical modeling techniques to mathematically describe numerical relationships between key economic forces such as labor, capital, interest rates, and government policies, and test the effects of changes in economic scenarios.
The General Price Level is an index that provides a measure of the purchasing power of money. It is used to gauge inflation or deflation in an economy.
Multicollinearity refers to the presence of independent variables in regression analysis that are associated with each other, having some degree of correlation. This phenomenon can complicate the interpretation of model coefficients and lead to unreliable results.
The use of historical data and mathematical techniques to model the historical path of a price, demand for a good, or consumption. Time series analysis is based on the premise that by knowing the past, the future can be forecast.
