When You Have an Omitted Variable Problem, the Assumption That

question 17

Multiple Choice

When you have an omitted variable problem, the assumption that E(u_i X_i) = 0 is violated. This implies that

• A)the sum of the residuals is no longer zero.
• B)there is another estimator called weighted least squares, which is BLUE.
• C)the sum of the residuals times any of the explanatory variables is no longer zero.
• D)the OLS estimator is no longer consistent.

---

Definitions:

Difficult People

A coworker is classified as difficult if he or she is uncooperative, disrespectful, touchy, defensive, hostile, or even very unfriendly.

High-Maintenance Person

An individual who requires an excessive amount of attention, support, or communication from others, often perceived as demanding or difficult to satisfy.

Dependent

Relying on someone or something else for support, maintenance, or supply.

Guard Against

To protect oneself or something from possible danger, harm, or adverse effects.