Which of the Following Assumptions Is Needed for the Plug-In

question 6

Multiple Choice

Which of the following assumptions is needed for the plug-in solution to the omitted variables problem to provide consistent estimators?

• A)The error term in the regression model exhibits heteroskedasticity.
• B)The error term in the regression model is uncorrelated with all the independent variables.
• C)The proxy variable is uncorrelated with the dependent variable.
• D)The proxy variable has zero conditional mean.

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