Dynare forums

hey guys,

first of all, sorry about this lame question but I'm totally noob ... so, my problem is:

how to declare an time and time variation (delta time) indexed variable, like

p(t,n)= A(n)+B(n)X(t)

which is a linear equation for pricing a zero-coupon (default free) bond at time "t" that pays 1 at time "t+n". the major problem is that when you advance to "t+1" "n" becomes "n-1"...

any sugestions?

Unfortunately Dynare isn't meant to handle continuous time problems.

Best

Michel

actually the problem is in discrete time... sorry not have mentioned it before...

Then you need as many P variables as you have maturities.

P1_t = A1+B1*X_t
P2_t = A2+B2*X_t

and so on. In Dynare you won't write the _t index. Of course, you need all the equilibrium conditions...

Best,

Michel

Ohhh... thx for the quick answer...