A model was created to study the Portuguese economy using a method called Bayesian estimation. The model includes different types of economic agents and factors like shocks and frictions to better match real-world data. The study assumes that the country's monetary policy is set by a central bank in a larger union, and that the country's size is not significant enough to affect the union's economy. The findings suggest that the domestic interest rate can deviate from the union's rate, and all trade and financial activities are with countries in the union.