Omitted Variable Bias Exists If the Omitted Variable Is

question 24

Multiple Choice

Omitted variable bias exists if the omitted variable is

• A) unrelated to the dependent variable or the independent variable.
• B) related to the dependent variable, but unrelated to the independent variable.
• C) related to the independent variable, but unrelated to the dependent variable.
• D) related to both the independent variable and the dependent variable.

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Definitions:

Continuous Innovation

Incremental updates or improvements to a product or service that do not significantly alter consumer behavior but enhance value.

Market Modification

Strategies used by companies to change the characteristics of the marketplace to improve competitiveness and customer appeal.

Discontinuous Innovation

A breakthrough product or service that creates a completely new market or drastically changes both the existing market and consumer habits.

Market Modification

The process of changing a market’s dynamics, including product offerings, pricing strategies, and customer engagement to achieve better performance or competitive advantage.