One of the Sources of Error in the RMSFE in the AR(1)

question 28

Multiple Choice

One of the sources of error in the RMSFE in the AR(1) model is

• A) the error in estimating the coefficients \(\beta _ { 0 } \text { and } \beta _ { 1 } \text {. }\)
• B) due to measuring variables in logarithms.
• C) that the value of the explanatory variable is not known with certainty when making a forecast.
• D) the model only looks at the previous period's value of Y when the entire history should be taken into account.

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