Which of the Following Is True of the Correlated Random

question 10

Multiple Choice

Which of the following is true of the correlated random effects approach (CRE) ?

• A)The CRE approach assumes that the unobserved effect is uncorrelated with the observed explanatory variables.
• B)The CRE approach cannot be used if the regression model includes a time-constant explanatory variable.
• C)The CRE approach considers that the unobserved effect is correlated with the average level of explanatory variables.
• D)The CRE estimate equals the random effects estimate.

---

Definitions:

Sample Mean

The average of all observations or data points in a sample.

Random Sample

A subset of a statistical population in which each member has an equal chance of being chosen for analysis or observation.

University Committee

A group of faculty members and sometimes students who come together to make decisions or manage certain aspects of university governance.

Standard Deviation

Standard Deviation is a statistic that measures the dispersion of a dataset relative to its mean, indicating how spread out the data points are.