Question

A negative serial correlation exists when a _______________ error is followed by a _______________ error.

Multiple Choice

• positive, negative

• negative, positive

• negative, negative

• positive, positive

Which one of the following correctly explains the difference between a trend model and a causal model?

Multiple Choice

• A trend model tracks the past time trend and projects it forward while the causal model looks at a change in an independent variable that causes a change in a dependent variable.

• A trend model identifies the factors causing change and places them into a bivariate regression model while the causal model matches the slope of the trend through an independent variable tied to a dependent variable’s change.

• A trend model uses a form of smoothing analysis to project the past time trend forward while the causal model looks at a change in an independent variable that causes a change in a dependent variable.

• A trend model looks at the past time trend to apply regression analysis while the causal model looks at a change in a dependent variable that causes a change in an independent variable.

Answer 1

Ans:

1)

Negative serial correlation exists when a negative error in one period carries over into a negative error for the following period.

A negative serial correlation exists when a negative error is followed by a negative error.

Correct option is:

negative,negative

2)

Correct option is:

A trend model tracks the past time trend and projects it forward while the causal model looks at a change in an independent variable that causes a change in a dependent variable.