Suppose an Economist Has Developed a Model for Forecasting Annual

question 101

Multiple Choice

Suppose an economist has developed a model for forecasting annual consumption,y_t ,as function of total labor income,x_1t ,and total property income,x_2t based on 20 years on annual data.The following regression model has been developed: = 7.81 + 0.91x_1t + 0.57x_2t with the standard error = 1.29 and the Durbin-Watson d statistic = 2.09.Using an alpha = .05,which of the following conclusions should be reached?

• A)Conclude that no positive autocorrelation exists
• B)Conclude that significant positive autocorrelation exists
• C)Uncertain whether positive or negative autocorrelation exists
• D)No significant autocorrelation exists.

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Definitions:

Incrementalist

An individual who believes in or advocates for gradual change or progress rather than sudden, radical shifts.

Developmental Perspective

An approach in psychology that focuses on the growth and change that occur throughout a person's lifespan, emphasizing how early experiences influence later development.

Interaction

The reciprocal action or influence between two or more entities, objects, or persons.

Neuroscientists

Scientists who specialize in the study of the nervous system, its structure, functions, and disorders.