Question: Consider the lagged dependent variable model given in (6.20). Using the Consumption-Income data from the Economic Report of the President over the period 1950-1993 which

Consider the lagged dependent variable model given in (6.20). Using the Consumption-Income data from the Economic Report of the President over the period 1950-1993 which is given in Table 5.1.

(a) Test for first-order serial correlation in the disturbances using Durbin’s h given in (6.19).

(b) Test for first-order serial correlation in the disturbances using the Breusch (1978) and Godfrey

(1978) test.

(c) Test for second-order serial correlation in the disturbances.

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