A couple of friends are very excited because they believe they have developed a perfect predictive model for the price of gold, and are trying to convince you to join them with an invest that, they say, will make you rich.

Looking at their notes you see that the "predictive" model is based on a simple AR$(1)$ model, where the intercept is $0,$ and the slope is $1.$

What would you tell your friends? $($Hint: investing is probably not a good idea, and you might want to give them a compelling reason not to do it themselves$).$

Group of answer choices

$"$I$\text{'}$m in$!$ Take my money!"

"Maybe you should check your results a bit more before investing real money?"

$"$I$\text{'}$m not going to invest, but you should go ahead..."

"The model is incorrect. There's no way the price of gold can be an AR$(1)$ process."

"The model clearly has a Unit Root, which means the process is a random walk, and no prediction is better than today's price. If you invest you'll very likely lose your money."