Which of the following models is not called a causal forecasting model? A) y_t = β₀ + β₁t + β₁y_t_-1 + ε_t B) y_t= β₀ + β₁y_t_-1 + ε_t C) y_t= β₀ + β₁t + ε_t D) y_t = β₀ + β₁x_t_-1 + ε_t

Question

Quizplus · Accepted Answer

Model C does not have any independent variables and only includes the time series variable. Therefore, it is not a causal forecasting model as it does not consider any external factors that may influence the outcome variable. The other three models include at least one independent variable and are considered causal forecasting models.

Which of the Following Models Is Not Called a Causal