Sensitivity Analysis of the Results May Include the Following with the Exception

question 10

Multiple Choice

Sensitivity analysis of the results may include the following with the exception of

• A)stability over time analysis of the estimated multipliers.
• B)using homoskedasticity only rather than HAC standard errors.
• C)investigation of omitted variable bias.
• D)looking at different computations of the HAC standard errors.

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Definitions:

Direct Method

A cash flow statement presentation method that shows actual cash flows from operating activities, detailing specific sources and uses of cash, as opposed to the indirect method which adjusts net income for non-cash transactions.

Dividends

Regular payments made by a corporation to its shareholders out of its profits or reserves.

Financing Activities

Transactions that result in changes in the size and composition of the equity and borrowings of an entity.

Marketable Securities

Financial instruments that are easily convertible into cash and are therefore considered very liquid.