TABLE 16-9
Given below are EXCEL outputs for various estimated autoregressive models for a company's real operating revenues (in billions of dollars)from 1989 to 2012.From the data,you also know that the real operating revenues for 2010,2011,and 2012 are 11.7909,11.7757 and 11.5537,respectively.
First-Order Autoregressive Model: Second-Order Autoregressive Model: Third-Order Autoregressive Model:
-Referring to Table 16-9 and using a 5% level of significance,what is the appropriate autoregressive model for the company's real operating revenue?
A)First-Order Autoregressive Model
B)Second-Order Autoregressive Model
C)Third-Order Autoregressive Model
D)Any of the above.

Question

TABLE 16-9
Given below are EXCEL outputs for various estimated autoregressive models for a company's real operating revenues (in billions of dollars)from 1989 to 2012.From the data,you also know that the real operating revenues for 2010,2011,and 2012 are 11.7909,11.7757 and 11.5537,respectively.
First-Order Autoregressive Model:  Second-Order Autoregressive Model:  Third-Order Autoregressive Model: 
-Referring to Table 16-9 and using a 5% level of significance,what is the appropriate autoregressive model for the company's real operating revenue?
A)First-Order Autoregressive Model 
B)Second-Order Autoregressive Model 
C)Third-Order Autoregressive Model 
D)Any of the above.

Quizplus · Accepted Answer

The first-order autoregressive model is the appropriate model because the p-value for the first-order term is less than 0.05, while the p-values for the second- and third-order terms are greater than 0.05.

TABLE 16-9 Given Below Are EXCEL Outputs for Various Estimated Autoregressive Models