Which of the Following Is True of Two Stage Least

question 8

Multiple Choice

Which of the following is true of two stage least squares estimators?

• A)The two stage least squares estimator is equal to the instrumental variable estimator if R² is equal to 1.
• B)The two stage least squares estimators are biased if the regression model exhibits multicollinearity.
• C)The two stage least squares estimators have lower variance than the ordinary least squares estimators.
• D)The two stage least squares estimators have large standard errors when R² lies close to 0.

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Definitions:

Stroke

A medical condition occurring when the blood supply to part of the brain is interrupted or reduced, causing brain cells to die and leading to potential loss of functions such as movement or speech.

Neglect Syndrome

The result of certain right parietal lobe lesions that leave a patient completely inattentive to stimuli to her left, including the left side of her own body.

Parietal Lobe

A region of the brain situated at the upper back area in the skull, crucial for processing sensory information and spatial orientation.

Right Frontal

Pertaining to or located in the right frontal lobe of the brain, an area associated with various cognitive functions including decision-making and emotional response.