A financial analyst is studying the quarterly sales data of a retail company over the past 10 years. The analyst decides to implement an autoregressive model to forecast future sales. In an autoregressive model of order 1, denoted as AR(1), the current observation is regressed on its immediately preceding value.

The model can be expressed as:

$$Y_t = \alpha + \beta Y_{t-1} + \epsilon_t$$

where:

$$Y_t$$ = current sales,

$$Y_{t-1}$$ = sales in the previous quarter,

$$\alpha$$ = constant term,

$$\beta$$ = coefficient for the lagged sales, and

$$\epsilon_t$$ = error term.

Assuming the model has been fitted successfully, which of the following statements regarding the AR(1) model is true?