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Consider the following simple regression model: Y=B+BX+BX+u i O 11i 22i i Suppose that you have estimated the model above and are concerned that

 

Consider the following simple regression model: Y=B+BX+BX+u i O 11i 22i i Suppose that you have estimated the model above and are concerned that the error term might be autocorrelated (i.e. serially correlated). Imagine that both tests suggest the presence of autocorrelation. Explain in detail how to handle this problem.

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