If You Had a Two Regressor Regression Model, Then Omitting

question 48

Multiple Choice

If you had a two regressor regression model, then omitting one variable which is relevant

• A)will have no effect on the coefficient of the included variable if the correlation between the excluded and the included variable is negative.
• B)will always bias the coefficient of the included variable upwards.
• C)can result in a negative value for the coefficient of the included variable, even though the coefficient will have a significant positive effect on Y if the omitted
• Variable were included.
• D)makes the sum of the product between the included variable and the residuals different from 0.

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Definitions:

Duress

A situation where an individual is forced to act against their will or make a decision under threat of harm or undue pressure.

Undue Influence

An unlawful practice where an individual takes advantage of their position of power over another person to influence their decisions.

Unilateral Mistake

An error made by one party in a contract situation, which may not necessarily void the contract unless the other party knew or should have known of the mistake.

Implied Misrepresentation

A false statement or omission made not through direct statements but through implications or conduct that misleads another party.