Consider the Following to Answer the Question(s) Below

Multiple Choice

Consider the following to answer the question(s) below:
Monthly closing stock prices for a utility company were obtained from January 2014 through August 2015. A regression model was estimated to describe the trend in closing stock prices over time.
-Which of the following statement is true about autocorrelation?

A) We use autocorrelation to predict values of y for values x far from the ones used to find the linear model equation.
B) When a regression model applied to autocorrelated data, the Independence assumption is satisfied.
C) When data highly correlated over time, each data point is similar to those around it. The Independence assumption is violated.
D) We use χ2 statistic to test for autocorrelation.
E) Autocorrelation occurs only if there is at least one extreme outlier.