Assume That You Have Used the OLS Estimator in the Cointegrating

question 9

Multiple Choice

Assume that you have used the OLS estimator in the cointegrating regression and test the residual for a unit root using an ADF test.The resulting ADF test statistic has a

• A)normal distribution in large samples.
• B)non-normal distribution which require ADF critical values for inference.
• C)non-normal distribution which require EG-ADF critical values for inference.
• D)normal distribution when HAC standard errors are used.

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Definitions:

Current Position Analysis

The evaluation of a company’s ability to pay its current liabilities.

Short-Term Creditors

Entities or individuals who have provided financial credit to a company with the expectation of being repaid within a short period, usually within a year.

Comparative Financial Statements

Financial statements that present the financial position, results of operations, and cash flows of an entity for multiple periods side-by-side for comparison.

Financial Statements

Financial statements are comprehensive reports created to provide insights into a company's financial performance, position, cash flows, and changes in equity over a specific period, typically including the balance sheet, income statement, statement of cash flows, and statement of changes in equity.