Conditional forecasting

Stochastic simulations
1

Hi!
I am trying to use conditional forecast in my model to see some permanent shocks mix with other shocks that hits the economy only one time.

But I have misunderstanding with my values for endo. variables should I fix them in percentage or in absolute value? I did assumptions for some values

, should I fix quarterly growth or just absolute value of endo. variable (for example, oil price)

Here is my part of code.

conditional_forecast_paths;

var a;
periods 1, 2, 3, 4, 5, 6, 7, 8, 9;
values 0 .9 .5 .7 .9, .9 .9 1 .9;

var b;
periods 1, 2, 3, 4, 5, 6, 7, 8, 9;
values .6, .65, 0.65, 0.75, 0.95 .95 .975 .9 .95;

var c;
periods 1, 2, 3, 4, 5, 6, 7, 8, 9;
values .75 .75 .5 .5 .5 .5 .5 .5 .75;

end;

Thanks for answer in advance!

2

That depends on what you are trying to achieve. Given a starting point, fixing growth rates is equivalent to fixing levels.