ECON 305 Study Guide - Midterm Guide: Karl Popper, Exogeny, Jargon

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Use the scrap paper assigned to you for rough work only do not hand it in. Write your nal answers on the exam paper itself and limit yourself to the space provided below each question. Do not write on the back of the exam paper. For your own sake, write as neatly as possible and label all diagrams clearly. If a question asks you to explain, you are expected to provide economic intuition in plain english (making minimal use of economic jargon). Explain how a theory can be used to make conditional forecasts. We de ned theory in class as a logical mapping from a set of exogenous variables to a set of endogenous variables; the endogenous variables are a function of the exogenous variables. A conditional forecast is a prediction of what happens conditional on some event happening. One can treat an event as an exogenous variable.