ABSTRACT
In Chapter 8, we discussed techniques for fitting a model to a time series realization. After a model is fit to a realization, you must take steps to assure that the model is suitable. The first step in this process is examine the residuals. This topic will be discussed in Section 9.1. Suppose now that you have obtained a model by using a model identification technique (such as AIC), estimated the parameters, and examined the residuals to satisfy yourself that they are sufficiently white (i.e., uncorrelated). Having obtained such a model does not necessarily indicate that the model is the most suitable one for your situation. After finding a model that seems appropriate, you should make a decision concerning whether the model makes sense. For example, the following questions are among those that should be asked in this regard.
