Suppose that for a time-series model with one predictor, you compute a Durbin-Watson statistic D = 1.409.Assume that n = 30 and α = 0.01.Then your decision is to ______.
A)fail to reject the null hypothesis D = 0
B)reject the null hypothesis D = 0
C)fail to reject the null hypothesis ρ = 0
D)reject the null hypothesis ρ = 0
E)fail to reject the null hypothesis ρ 0

Question

Suppose that for a time-series model with one predictor, you compute a Durbin-Watson statistic D = 1.409.Assume that n = 30 and α = 0.01.Then your decision is to ______.
A)fail to reject the null hypothesis D = 0
B)reject the null hypothesis D = 0
C)fail to reject the null hypothesis ρ = 0
D)reject the null hypothesis ρ = 0
E)fail to reject the null hypothesis ρ > 0

Quizplus · Accepted Answer

The Durbin-Watson statistic tests for autocorrelation in the residuals. A value of 1.409 suggests some positive autocorrelation, but to make a decision, we compare it to critical values. For n = 30 and α = 0.01, the critical values would suggest failing to reject the null hypothesis of no autocorrelation (ρ = 0) if D is not significantly different from 2.

Suppose That for a Time-Series Model with One Predictor, You