Durbin Watson for Serial Correlation, WHY?
I rushed through the quant material when I took the exam last year. I am no quant expert, but this question has been bugging me for some time.
Why does the CFA decide to go with Durbin Watson to test for serial correlation? I thought DW only tests for first order serial correlation and the inconclusive area of the test makes it a less effective test. Is there a reason behind this?
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