This is the Complete Question

Suppose that xt follows the stationary AR(1) model Xt = 1 + 0.5xt-1 + Ut, where ut is independently, and identically distributed across t with E [ut] = 0 and var[ut] = 1. (a) Compute the first two autocorrelations of xt, i.e., cov(Xt, Xt-1) and cov(Xt, Xt-2) (b) Suppose x7 = 1.2. Compute XT+IT = EXT+1 | XT, XT-1, ...]