7. The New Keynesian Model

A notebook that was mentioned in classes (but not covered for lack of time) can be found here.

This notebook deals with "The New Keynesian Model with Persistence and a Shock to r^n". It is an interesting exercise because we can obtain hump-shaped impulse response functions and relevant statistical information with one single shock and persistence in inflation and the output gap.

This notebook will not be included in the evaluation process.