Why Should Augmented Dickey-Fuller Tests Always Be Used When Performing $\rho$

question 4

Multiple Choice

Why should augmented Dickey-Fuller tests always be used when performing econometric analysis?

• A)the augmented tests allow for more degrees of freedom
• B)so we can test hypotheses using a t-distribution
• C)since no assumptions about the sign of \(\rho\) are needed to perform a one-tailed test
• D)to confirm that error terms are not autocorrelated

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