- CFA Exams
- CFA Level I Exam
- Study Session 2. Quantitative Methods (1)
- Reading 5. Multiple Regression
- Subject 11. Serial Correlation
CFA Practice Question
Generally positive serial correlation will lead us to compute artificially ______ (small? large?)standard errors for the regression parameters, causing the t-statistics to be ______ (small? large).
Correct Answer: Small, Large
The standard errors will be too small, causing the t-statistics to be large (appearing statistically significant).
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