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What Are the Assumptions Required for OLS to Be BLUE

question 20

Essay

What are the assumptions required for OLS to be BLUE for time-series data? Write out and explain each.


Definitions:

Pre-Tax Salvage Value

The estimated value of an asset at the end of its useful life, before subtracting taxes associated with its disposal.

Working Capital

Working Capital is the difference between a company's current assets and current liabilities, indicating the liquidity and operational efficiency of the business.

Tax Rate

The percentage at which an individual or corporation is taxed; the government sets these rates to collect revenues.

UCC

The Uniform Commercial Code (UCC) is a comprehensive set of laws governing commercial transactions in the United States, including sales, leases, negotiable instruments, and secured transactions.

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