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Given x and y coordinates, plot out two lines. see matplotlib.pyplot.plot. Here we will plot out the extremes of AR(1), white noise (no persistence), and random walk (fully persistent shocks).
# Import Packages
import numpy as np
import matplotlib.pyplot as plt
# Generate X and Y
np.random.seed(123)
ar_fl_y1_rand = np.random.normal(0, 2, 100)
ar_fl_y2_rand = np.cumsum(np.random.normal(0, 1, 100))
ar_it_x_grid = np.arange(1,len(ar_fl_y1_rand)+1)
# Start Figure
fig, ax = plt.subplots()
# Graph
ax.plot(ar_it_x_grid, ar_fl_y1_rand,
color='blue', linestyle='dashed',
label='sd=2, 0 persistence')
## [<matplotlib.lines.Line2D object at 0x0000026F593E2FA0>]
ax.plot(ar_it_x_grid, ar_fl_y2_rand,
color='red', linestyle='solid',
label='sd=1, random walk')
# Labeling
## [<matplotlib.lines.Line2D object at 0x0000026F598CF5E0>]
ax.legend(loc='upper left')
## <matplotlib.legend.Legend object at 0x0000026F56E7D100>
plt.ylabel('Random Standard Normal Draws')
## Text(0, 0.5, 'Random Standard Normal Draws')
plt.xlabel('Time Periods')
## Text(0.5, 0, 'Time Periods')
plt.title('White Noise')
## Text(0.5, 1.0, 'White Noise')
plt.grid()
plt.show()