When You Add State Fixed Effects to a Simple Regression

question 30

Multiple Choice

When you add state fixed effects to a simple regression model for U.S.states over a certain time period, and the regression R2 increases significantly, then it is safe to assume
That

• A)the included explanatory variables, other than the state fixed effects, are unimportant.
• B)state fixed effects account for a large amount of the variation in the data.
• C)the coefficients on the other included explanatory variables will not change.
• D)time fixed effects are unimportant.

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Definitions:

Self-image

The mental portrayal, concept, or image an individual holds about themselves.

Self-esteem Source

The origin or factors that contribute to an individual's perception of their own worth or value.

External Locus

The belief that one's fate or outcomes in life are determined by external forces or luck rather than one's own actions.

Control

The faculty to affect or guide how people act or the evolution of events.