The distributed lag model is given by
A)Yt = β0 + β1Xt + β2Yt-1 + ut.
B)Yt = β0 + β1Yt-1 + β2Yt-2 + ...+ βrYt-r + ut.
C)Yt = β0 + β1ut + β2ut+1 + β3ut+2 + ...+ βr+1ut+r + et.
D)Yt = β0 + β1Xt + β2Xt-1 + β3Xt-2 + ...+ βr+1Xt-r + ut.

Question

Quizplus · Accepted Answer

A distributed lag model includes current and past values of an independent variable (Xt, Xt-1, Xt-2, etc.) to explain the dependent variable (Yt).

The Distributed Lag Model Is Given by