Which of the Following Statements Is True

question 19

Multiple Choice

Which of the following statements is true?

• A)Fixed effects estimation is not suitable when the unobserved cluster effect is correlated with one or more explanatory variables.
• B)Fixed effects approach is not applicable if the key explanatory variables change only at the level of the cluster.
• C)The ordinary least squares standard errors are incorrect when there is cluster effect.
• D)Random effects estimation can be applied to a cluster sample only if the unobserved cluster effect is correlated with one or more explanatory variables.

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Definitions:

Wrongful Dissociation

The inappropriate or unauthorized withdrawal of a partner from a partnership, potentially leading to legal consequences.

Buyout Price

The agreed upon amount for which one party can purchase another party's interest in a company or investment.

Dissolution

The process of formally ending or dissolving a legal entity, such as a corporation, partnership, or marriage.

LLP

Stands for Limited Liability Partnership, a legal structure that offers some of the benefits of a partnership while limiting personal liability of the partners.