Describe Each of the Five Criteria for Identifying a Causal

question 24

Essay

Describe each of the five criteria for identifying a causal effect and provide an example of each. Which are best demonstrated through experiments? Why? Which do experiments not demonstrate well? How can experimental designs be altered to compensate? Is anything lost with quasi-experimental designs?

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Definitions:

Paid-In Capital

Paid-in capital is the amount of money a company has received from shareholders in exchange for shares of stock.

Par Value

The nominal or face value of a bond, share of stock, or other financial instrument, as stated by its issuer.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, typically with dividends that must be paid out before dividends to common stockholders.

Par Value

A nominal or face value assigned to a share of stock by the company's charter, which may not reflect the actual market value.