Answer: Residual values are constant and finite

## Explanation For a correctly specified autoregressive model: - **Residuals should be constant and finite**: This is consistent with the assumption of homoskedasticity and stationarity - **Residual autocorrelations should NOT differ significantly from zero**: If residual autocorrelations are significantly different from zero, it indicates that the model has not captured all the systematic patterns in the data, suggesting the model is misspecified Therefore, option A (residual values are constant and finite) is most consistent with a correctly specified autoregressive model. Option B would indicate model misspecification.

Author: LeetQuiz Editorial Team