Question

Use Statistical Tables to test for serial correlation given the following Durbin-Watson d statistics for serial correlation. Draw a picture for hypothesis testing. State your hypothesis.

i. d=0.62, K=2, N=21, 5-percent, one-sided positive test

ii. d=3.89, K=3 N=18, 5-percent, one-sided positive test

iii. d=1.31, K=4, N=36, 5-percent, one-sided positive test

Answer 1

i. d=0.62, K=2, N=21, 5-percent, one-sided positive test

dL = 1.125, dU = 1.538

d = 0.62 < dL

hence there is evidence of positive correlation

ii. d=3.89, K=3 N=18, 5-percent, one-sided positive test

dL = 0.933 , dU = 1.696

d = 3.89 > dL, no statistical evidence

iii. d=1.31, K=4, N=36, 5-percent, one-sided positive test

dL = 1.236 , dU = 1.724

1.236 < 1.31 < 1.724

the test in inconclusive