The following timeplot shows a portion of the month-to-month changes in the value of shipments of computers and electronics (after seasonal adjustment, as used in the text of this chapter). The change...

The following timeplot shows a portion of the month-to-month changes in the value of shipments of computers and electronics (after seasonal adjustment, as used in the text of this chapter). The change from March to April 2001 was dramatically large and negative, producing the outlier in the timeplot.

Let
 denote the change in the value of the shipments. The scatterplot shown above graphs
 on its lagged value
.

(a) Does this scatterplot suggest the presence of dependence between adjacent changes in the value of shipments?

(b) Where does the outlier produced by the large drop from March to April appear in the scatterplot of
 on
?

(c) Do you think that the outlier influences the estimated correlation between
 and
?

(d) To remove the outlying change in shipments from the estimated correlation between
 and
, how many data points need to be excluded from the scatterplot?