16.31 Refer to the data file Hourly Earnings, showing earnings over 24 months. Denote the observations xt
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16.31 Refer to the data file Hourly Earnings, showing earnings over 24 months. Denote the observations xt 1t = 1, 2,
c, 242. Now, form the series of first differences:
zt = xt - xt-1 1t = 2, 3,
c, 242 Fit autoregressive models of orders 1–4 to the series zt.
Using the approach of this section for testing the hypothesis that the autoregressive order is p - 1 against the alternative of order p, with a 10% significance level, select one of these models. Using the selected model, find forecasts for zt, where t = 25, 26, and 27. Hence, obtain forecasts of earnings for the next 3 months.
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Related Book For
Essential Mathematics And Statistics For Science
ISBN: 9780470694480
2nd Edition
Authors: Graham Currell, Dr. Antony Dowman
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