Mark each of the following statements TRUE or FALSE.

(A)

ut = ut 1 + t is a second-order Markov scheme.

(B) The standard error of the regression (SER) is biased upward in the presence of serial correlation.

(C) The standard error of ˆ

1 is biased downward in the presence of serial correlation.

(D) If ρ > 0, then the Durbin-Watson test should be for positive serial correlation.

(E) The Durbin-Watson test is invalid in autoregressive models.