The Board of Governors of the Federal Reserve System publishes data on mortgage debt outstanding by type of property and holder. The following data give the amounts of residential nonfarm debt (in $ billions) held by savings institutions in the United States over a 10-year period. Use these data to develop an auto-regression model with a one-period lag. Discuss the strength of the model.
Year .. Debt
1 ..... 529
2 ..... 554
3 ..... 559
4 ..... 602
5 ..... 672
6 ..... 669
7 ..... 600
8 ..... 538
9 ..... 490
10 ..... 470