Weighted Least Squares Estimation Is Used Only When _____

question 24

Multiple Choice

Weighted least squares estimation is used only when _____.

• A)the dependent variable in a regression model is binary
• B)the independent variables in a regression model are correlated
• C)the error term in a regression model has a constant variance
• D)the functional form of the error variances is known

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Definitions:

Interest-Rate Cost-Of-Funds

The expense incurred by borrowers in order to access funds, determined by the interest rate.

R&D Expenditures

Financial investments made towards research and development activities aimed at creating new products, processes, or technologies.

Expected-Rate-Of-Return

An alternative phrasing for the anticipated gain or potential loss from an investment over a specified period, accounting for risk.

R&D Activities

Research and Development activities involve investigative efforts companies undertake to innovate and introduce new products or services.