The value of the Durbin Watson test statistic in a regression with 4 regressors (including the constant term) estimated on 100 observations is 3.6. What might we suggest from this?
A) The residuals are positively autocorrelated
B) The residuals are negatively autocorrelated
C) There is no autocorrelation in the residuals
D) The test statistic has fallen in the intermediate region

Question

Quizplus · Accepted Answer

The Durbin Watson (DW) test statistic ranges from 0 to 4, where a value around 2 suggests no autocorrelation, values approaching 0 indicate positive autocorrelation, and values approaching 4 suggest negative autocorrelation. A DW statistic of 3.6 suggests the residuals are negatively autocorrelated.

The Value of the Durbin Watson Test Statistic in a Regression