Po Suppose that Y, follows a stationary AR(1) model, Y = Bot BYt- 1 + ut. The mean of Y, IS MY = 1 -
Po Suppose that Y, follows a stationary AR(1) model, Y = Bot BYt- 1 + ut. The mean of Y, IS MY = 1 - B, Yt+ hit, the h-period-ahead forecast of Y-, is given by: OA. Bo ( 1 + B , + B , 2 + ... + By " -1) + BY + OB. Bo ( 1 + B , + B, 2 + .. + B,h)+ Byhy OC. My + By ( Y + - MY) O D. Both (a) and (c)
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