The following is not an appropriate way to tell whether two ...

[abarnes]

The following is not an appropriate way to tell whether two variables are cointegrated:
 
  A) see if the two variables are integrated of the same order.
  B) graph the series and see whether they appear to have a common stochastic trend.
  C) perform statistical tests for cointegration.
  D) use expert knowledge and economic theory.

Question 2

In a VECM,
 
  A) past values of Yt -  Xt help to predict future values of Yt and/or Xt.
  B) errors are corrected for serial correlation using the Cochrane-Orcutt method.
  C) current values of Yt -  Xt help to predict future values of Yt and/or Xt.
  D) VAR techniques, such as information criteria, no longer apply.

[kusterl]

Answer to Question 1

Answer: A

Answer to Question 2

Answer: A