A stationary autoregressive model of order one can be written as

y_t= _0+ _1y_t1+ _t,t = 1, 2, ....Determine which of the following statements about this model is false?

a.

If the parameter 1= 0, then the model reduces to a white noise process.

b.

The absolute value of the parameter 1 must be less than 1.

c.

Only the immediate past value, yt1, is used as a predictor for yt.

d.

The parameter 0 must not equal 1.

e.

If the parameter 1=1, then the model is a random walk.

PLEASE EXPLAIN YOUR ANSWER