Does the Interpretation on the Estimated Coefficient on the Treatment

question 35

Multiple Choice

Does the interpretation on the estimated coefficient on the treatment change if you use a proxy variable to control for a confounding factor?

• A) No, the estimated coefficient is a consistent estimate of the causal effect.
• B) No, but instead of getting causal estimate you're only estimating partial correlations.
• C) Yes, the coefficient on the treatment is biased.
• D) Yes, the coefficient on the treatment suffers from the simultaneity bias.

---

Definitions:

Equilibrium

A state where supply and demand balance each other, and as a result, prices become stable.

MU/P

Marginal Utility per Price, a concept in economics that represents the additional utility or satisfaction obtained per unit of expenditure.

Consumer Behavior

The examination of the ways in which individuals, groups, and entities choose, purchase, utilize, and discard products, services, ideas, or experiences to fulfill their wants and needs.

Marginal Utility

The change in satisfaction or utility a consumer receives from consuming an additional unit of a good or service.