Suppose that Yt follows the stationary AR (1) model LaTeX: Y_t=2.5+0.7Y_{t-1}+\varepsilon_tYt=2.5+0.7Yt−1+ϵt, where LaTeX: \varepsilon_tϵt is i.i.d. with LaTeX: E(\varepsilon_t)=0E(ϵt)=0 and LaTeX: Var(\varepsilon_t)=9Var(ϵt)=9

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