13.33 Based on the results in Exercise 13.32, answer the following questions in which a lagged dependent variable is added to the above model.

a. Write the model in which a lagged dependent variable is added.

b. Compute the estimated value for serial correlation.

c. Calculate the Durbin’s h statistic with the estimated standard deviation of the estimated coefficient for the lagged dependent variable is 0.0024.

d. Justify your finding in part c.

Application Exercises