An Estimated Second-Order Autoregressive Model for Average Mortgage Rate Is $\hat { \gamma } _ { t } = - 2.5 + 1.8 y _ { t - 1 } - .5 y _ { t - 2 }$

question 107

Essay

An estimated second-order autoregressive model for average mortgage rate is: $\hat { \gamma } _ { t } = - 2.5 + 1.8 y _ { t - 1 } - .5 y _ { t - 2 }$ .If the average mortgage rate in 2003 was 7.0,and in 2002 was 6.5,the forecast for 2004 is ____________________,and for 2005 is ____________________.

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Definitions:

Accounts Receivable

Money owed to a company by its customers for goods or services sold on credit.

Total Assets

The combined value of all owned resources that have economic value and can be converted into cash. This includes both current and non-current assets.

Quick Ratio

A measure of a company's ability to meet its short-term obligations with its most liquid assets.

Total Current Assets

The sum of all assets that are expected to be converted into cash, sold, or consumed within one year or the normal operating cycle, whichever is longer.