Which of the Following Statements Is True

question 18

Multiple Choice

Which of the following statements is true?

• A)A truncated regression is a special case of a random sample selection.
• B)Nonrandom sample selection can arise in cases of cross-sectional and time series data, but not in the case of panel data.
• C)The Tobit regression model is based on endogenous sample selection.
• D)The censored regression model is based on nonrandom sample selection.

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Definitions:

Liquid Ratio

A financial metric comparing a company's liquid assets (cash and marketable securities) to its current liabilities, often used to assess liquidity.

Common Size Statement

A financial statement in which each line item is expressed as a percentage of a significant total, facilitating comparison across companies or periods.

Liabilities Plus Equity

Liabilities plus equity represents the total value of a company's financial obligations plus its owners' investments, crucial for understanding its financial health.

Net Income

A company's overall earnings following the deduction of all expenses and taxes from its total revenue.