In Econometrics, Simultaneity Arises When

question 10

Multiple Choice

In econometrics, simultaneity arises when:

• A)strictly exogenous explanatory variables determine the dependent variable through a step-by-step process.
• B)the error term is correlated with both the dependent variable and explanatory variables.
• C)one or more of the explanatory variables is jointly determined with the dependent variable.
• D)both serial correlation and heteroskedasticity are present in an hypothesized model.

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Definitions:

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A plan or course of action, as of a government, political party, or business, intended to influence and determine decisions, actions, and other matters.

Probability

A measure of the likelihood that an event will occur, expressed as a number between 0 (impossibility) and 1 (certainty).

Sample Space

The complete set of all possible outcomes of a random experiment or event.

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A test designed to evaluate an individual's knowledge and skills in driving to determine their eligibility for a driver's license.