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A Second-Order Autoregressive Model for Average Mortgage Rate Is: Ratei

Question 22

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A second-order autoregressive model for average mortgage rate is: Ratei = - 2.0 + 1.8(Rate)i-1 - 0.5 (Rate)i-2.
If the average mortgage rate in 2012 was 7.0,and in 2011 was 6.4,the forecast for 2014 is .

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