%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
% 14.461 Blanchard-Kahn Basics                                            %
% ----------------------------------------------------------------------- %
% Suman Basu, September 2005                                              %
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%

tic

% Starting the program
clear

% Set eigenvalues, matrix and find steady state
l1 = 1.5;
l2 = 0.5;
M = [l1 0; 0 l2];
X = [0; 0];
xss = 0;

% Set initial values
X(1) = 0;
X(2) = 0.5;

% No. of periods
T = 10;

% Set up grid for graphing
var = zeros(1, T);
var(1,1) = X(2);
var(1,2) = X(1);

% Generate impulse response
for i = 1:T-2
    X = M*X;
    var(1, i + 2) = X(1);
end

%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
% Graph time series                                                       %
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
plot(1:T, var); grid
title('Evolution of var')

toc