When You Have an Omitted Variable Problem,the Assumption That E(ui

question 38

Multiple Choice

When you have an omitted variable problem,the assumption that E(ui Xi) = 0 is violated.This implies that

• A)the sum of the residuals is no longer zero.
• B)there is another estimator called weighted least squares,which is BLUE.
• C)the sum of the residuals times any of the explanatory variables is no longer zero.
• D)the OLS estimator is no longer consistent.

Understand and apply the Durbin-Watson test for detecting autocorrelation in regression analysis.

Interpret regression analysis output, including the analysis of variance table.

Formulate and test hypotheses in the context of regression analysis.

Recognize the implications of violating regression assumptions like independence of errors.

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Definitions:

Second Language Learning

The process through which a person learns a language other than their native language, often through formal education or immersion.

Additive Strategy

A problem-solving approach that involves combining different strategies or elements in order to achieve a solution.

Elimination Strategy

A problem-solving approach that systematically removes options to find the best solution.

Functional Fixedness

A cognitive bias that limits a person's ability to use an object only in the way it is traditionally used, hindering problem-solving and creativity.