Which of the Following Statements Is Correct Concerning the Conditions

question 7

Multiple Choice

Which of the following statements is correct concerning the conditions required for OLS to be a usable estimation technique?

• A) The model must be linear in the parameters
• B) The model must be linear in the variables
• C) The model must be linear in the variables and the parameters
• D) The model must be linear in the residuals.

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Definitions:

SSE

Sum of Squared Errors, a measure used in statistics to quantify the discrepancy between the data and an estimation model.

MSR

Mean Square Regression, indicating the average of squared differences between the observed and predicted values in regression analysis.

Observations

Data collected or measured during a study, experiment, or survey.

Coefficient Of Determination

A statistical measure that determines the proportion of variance in the dependent variable predictable from the independent variable(s).