15.1 The Nature of Simultaneous Equation Models C=B+B. Io YC+ Endogenous variable Variable that is an inherent part of the system being studied and that is determined within the system Variable that is caused by other variables in a causal system Exogenous variable/predetermined variable Variable entering from and determined from outside the system being studied C If there are more endogenous variables, there will be more equations15.1 The Nature of Simultaneous Equation Models Ct=B1+B2Yt+ut Yt=Ct+It Endogenous variable: Variable that is an inherent part of the system being studied and that is determined within the system. Variable that is caused by other variables in a causal system Exogenous variable/predetermined variable: Variable entering from and determined from outside the system being studied. ◆ If there are more endogenous variables, there will be more equations