Suppose That You Are Performing the Davidson-MacKinnon Test for Choosing

question 10

Multiple Choice

Suppose that you are performing the Davidson-MacKinnon test for choosing among non-nested alternatives and that in the second stage you estimate the sample regression function and find that the predicted values are not statistically significant.You decide that

• A)the initial model is statistically preferred.
• B)the second model is statistically preferred.
• C)neither model is appropriate.
• D)the coefficient estimates from both models are biased.

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Definitions:

Alternative Hypothesis

The hypothesis that proposes there is a statistically significant difference between two data sets or a deviation from the null hypothesis.

Spearman Rank

A method that non-parametrically quantifies the rank correlation to determine how well a monotonic function can depict the relationship between two variables.

Precipitation

Any form of water - liquid or solid - falling from the atmosphere to the Earth's surface, including rain, snow, sleet, and hail.

Automobile Accidents

Unplanned, damaging events involving one or more vehicles, often resulting in injury or damage to property.