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

question 16

Multiple Choice

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

• A)the error in estimating the coefficients β₀ and β₁.
• 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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