series dependence, we start with univariate ARMA models. To motivate the ... t are not only affected by the shock at time t, but also the shocks that have taken place before time t. ... Similarly, we can write down the effects for an MA(∞) process.
However, ARMA model cannot be applied to any time series. The ideal series should ... variance and covariance since those moments do not depend on t ... We cannot run a regression here because et is unobservable. ... down in a deflation).
Here the ACF cuts off at lag 2. This property generalizes to other MA models. For an MA(q) model, the lag-q ACF is not zero, but ...
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Note: For ARIMA and Auto-ARIMA, you can run as many forecast periods as you wish if ... ARMA model building and estimation may then be developed, and this is done via ... As we have seen, however, many time series are certainly not stationary, ... and pin down the order of a moving average model for stationary series.
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