The Gauss-Markov Theorem Proves That

question 30

Multiple Choice

The Gauss-Markov Theorem proves that

• A)the OLS estimator is t distributed.
• B)the OLS estimator has the smallest mean square error.
• C)the OLS estimator is unbiased.
• D)with homoskedastic errors, the OLS estimator has the smallest variance in the class of linear and unbiased estimators, conditional on X₁,…, X_n.

Calculate the total interest expense over the life of bonds.

Understand and apply the straight-line method of bond discount/premium amortization.

Apply the effective interest rate method for bond amortization schedules.

Understand the concepts of callable bonds and their accounting treatment.