Econometrics formative assignment Research Paper

Econometrics formative assignment - Research Paper Example -0.067 31.280 0.260 *|. | *|. | 28 -0.079 -0.077 32.913 0.239 .|. | .|. | 29 -0.020 -0.019 33.016 0.277 .|. | .|. | 30 0.029 -0.015 33.237 0.312 .|. | .|. | 31 -0.029 -0.035 33.462 0.349 .|* | .|** | 32 0.183 0.197 42.344 0.104 .|. | .|. | 33 -0.019 -0.013 42.444 0.126 .|. | .|. | 34 0.027 0.042 42.636 0.147 .|. | .|. | 35 -0.052 -0.047 43.368 0.157 .|. | *|. | 36 0.019 -0.072 43.470 0.183 Correlogram for Vodafone Date: 08/17/09 Time: 21:05 Sample: 1/01/1990 12/31/2008 Included observations: 224 Autocorrelation Partial Correlation ACPAC Q-Stat Prob .|. | .|. | 1 0.002 0.002 0.0007 0.979 .|. | .|. | 2 0.019 0.019 0.0826 0.960 .|* | .|* | 3 0.182 0.182 7.6489 0.054 *|. | *|. | 4 -0.061 -0.063 8.4992 0.075 .|* | .|* | 5 0.146 0.145 13.451 0.019 .|. | .|. | 6 0.015 -0.021 13.502 0.036 .|* | .|* | 7 0.088 0.116 15.322 0.032 .|* | .|* | 8 0.132 0.076 19.422 0.013 .|. | .|. | 9 -0.027 -0.009 19.596 0.021 .|. | .|. | 10 0.048 -0.006 20.139 0.028 .|* | .|* | 11 0.153 0.140 25.713 0.007 .|* | .|* | 12 0.115 0.116 28.881 0.004 .|. | .|. | 13 0.006 -0.033 28.889 0.007 .|. | .|. | 14 0.009 -0.041 28.907 0.011 .|. | *|. | 15 -0.032 -0.083 29.153 0.015 .|. | .|....The two vertical lines in the first column enclose the 95% confidence interval. Id k that extends past the broken line, reject the null hypothesis that k = 0 at 5% level of significance. Otherwise, do not reject the null hypothesis" (Danao). In this particular tests, the result for BARC, VOD and FTALLSH show that we do not reject the null hypothesis that k = 0. But for the GSK graph, the result is opposite. We have necessary proof to reject the null hypothesis. Decision Rule: "If the absolute value of the ADF Test Statistic is less than the value of the McKinnon Critical Values at the chosen level of significance, then the series has a unit root and is therefore non-stationary.