2. Which of following statement is NOT correct about p: (5 points) € = pe-1 + u a. As p approaches one in absolute value

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2 Which Of Following Statement Is Not Correct About P 5 Points Pe 1 U A As P Approaches One In Absolute Value 1 (26.45 KiB) Viewed 36 times

2. Which of following statement is NOT correct about p: (5 points) € = pe-1 + u a. As p approaches one in absolute value, the value of the previous observation of the error term becomes more important in determining the current value of error shock and a high degree of serial correlation exists. b. if p is greater than one in absolute value is unreasonable because it implies that the error term tends to continually increase in absolute value over time ("explode"). c. if Ipl < 1, then € is stationary d. none of above