Question
An entrepreneur commissions research to evaluate the relationship between logarithm of sales in her firm and logarithm of advertising expenses. A time series regression model
An entrepreneur commissions research to evaluate the relationship between logarithm of sales in her firm and logarithm of advertising expenses. A time series regression model is estimated based on data for 65 months, but it is suspected that the errors may be autocorrelated. The statistical table for the Durbin-Watson test, at a significance level of 0.05, for the relevant sample size and number of regression coefficients reads d, = 1.57 and d,= 1.63. If the Durbin-Watson statistic for this regression is denoted D, which of the following autocorrelation tests are correct? a. If D = 2.50, there is significant evidence of negative autocorrelation b. If D = 2.40, there is significant evidence of negative autocorrelation. c. If D = 2.10, there is significant evidence of positive autocorrelation. d. If D = 1.60, there is significant evidence of positive autocorrelation. e. If D = 1.50, there is no significant evidence of autocorrelation.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started