Question

One-time shocks to a time series from a distinctly external influence, such as a sudden dip in consumer sales after a disruptive event, are called _____ variations. a. natural b. exogenous c. Black Swan d. unknown

Answer 1

Answer: B. Exogenous

Explanation: Exogenous variations are caused by variables that are not affected by other variables in the system. Their values are determined outside the model and as such are imposed on the model; they are fixed when they enter the model, are taken as a “given” in the model, and are not determined or explained by the model. They also influence endogenous variations in the model. For example, a change in the consumer's income, sudden dips in consumer sales after a disruptive event etc.

Answer 2

b. exogenous

Step-by-step explanation:

Exogenous variations are variations that occur in one independent variable that helps one predict one or more dependent variables in a model.

Endogenous variations on the other hand are values that are determined by other variables ( these controlling variables are exogenous variables).

So in this scenario one-time shocks to a time series from a distinctly external influence (exogenous variable), such as a sudden dip in consumer sales (endogenous variable) after a disruptive event.