Consider the Multiple Regression Model with Two Regressors X₁ and X₂

question 8

Multiple Choice

Consider the multiple regression model with two regressors X₁ and X₂, where both variables are determinants of the dependent variable. When omitting X₂ from the regression, then there will be omitted variable bias for $\widehat { \beta 1 }$

• A)if X₁ and X₂ are correlated
• B)always
• C)if X₂ is measured in percentages
• D)if X₂ is a dummy variable

Calculate probabilities using the hypergeometric formula.

Apply the concept of sampling with or without replacement in probability calculations.

Contrast the hypergeometric, binomial, and Poisson distributions.

Derive and interpret the mean, variance, and other probabilities from given hypergeometric distribution scenarios.

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Definitions:

Doggerel

A term unrelated to economics, referring to irregularly or poorly constructed verse, often of a humorous or trivial nature.

Paasche Price Index

An economic indicator that measures the change over time in the cost of a fixed basket of consumer goods and services, using the current period as the base.

Doggerel

Verse or words that are poorly written or expressed, often characterized by clichés, sloppy meter, and a lack of seriousness or artistic depth.

Revealed Preference

A theory in economics that assumes individuals' preferences can be discerned by observing their purchasing habits and behaviors.