Which of the Following Statements Is True

question 8

Multiple Choice

Which of the following statements is true?

• A)A model with a lagged dependent variable cannot satisfy the strict exogeneity assumption.
• B)Stationarity is critical for OLS to have its standard asymptotic properties.
• C)Efficient static models can be estimated for nonstationary time series.
• D)In an autoregressive model, the dependent variable in the current time period varies with the error term of previous time periods.

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Definitions:

Supply Decrease

A reduction in the quantity of a good that producers are willing or able to sell, often due to factors such as increased production costs, taxation, or supply chain disruptions.

Excess Supply

A situation in a market where the quantity of a good or service available exceeds the quantity demanded at the current price, leading to surplus.

Scarcity

A basic issue in economics where human desires appear unlimited, but the world has finite resources.

Price of Contact Lenses

The cost at which contact lenses are sold, determined by factors like brand, technology, supply, and demand.