Answer-first summary for fast verification
Answer: three past values of the variable to predict the current value of the variable.
## Explanation An autoregressive model of order p (AR(p)) uses p past values of the variable to predict the current value. Therefore: - **AR(1)**: Uses 1 past value - **AR(2)**: Uses 2 past values - **AR(3)**: Uses 3 past values For a third-order autoregressive model (AR(3)), the general form is: y_t = b_0 + b_1y_{t-1} + b_2y_{t-2} + b_3y_{t-3} + ε_t This uses three past values (y_{t-1}, y_{t-2}, y_{t-3}) to predict the current value y_t, making option A correct.
Author: LeetQuiz Editorial Team
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A third-order autoregressive model uses:
A
three past values of the variable to predict the current value of the variable.
B
the past value and the current value of the variable to predict the subsequent value of the variable.
C
the past value of the variable to predict the current value and two subsequent values of the variable.
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