The Successful Use of a Proxy Variable to Control for a Confounding

question 42

Multiple Choice

The successful use of a proxy variable to control for a confounding factor will allow you to accomplish all of the following except:

• A) consistently estimate the treatment effect of interest.
• B) limit the endogeneity problem associated with the confounding factor.
• C) uncover the size of the semi-partial correlation of the confounding factor and the outcome.
• D) conduct appropriate hypothesis testing for the treatment effect of interest.

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Definitions:

Return On Investment

A measure used to evaluate the efficiency or profitability of an investment, calculated by dividing the profit gained from an investment by the cost of the investment.

Operating Income

The profit earned from a firm's core business operations, excluding deductions of interest and taxes.

Investment Turnover

A measure of a company's efficiency in using its investments to generate sales, calculated as sales divided by the average value of investments.

Profit Margin

The percentage of revenue that remains as profit after all expenses have been subtracted from sales.