If Xit Is Correlated with Xis for Different Values of S

question 35

Multiple Choice

If Xit is correlated with Xis for different values of s and t,then

• A)Xit is said to be autocorrelated
• B)the OLS estimator cannot be computed
• C)statistical inference cannot proceed in a standard way even if clustered standard errors are used
• D)this is not of practical importance since these correlations are typically weak in applications

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Definitions:

Sample Observations

Individual data points collected from a subset of a larger population for the purpose of statistical analysis.

Probability

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

Sample Mean

The average of a set of numerical values taken from a sample of a population.

Standard Deviation

A metric that represents the extent of variability or spread within a group of numbers, demonstrating how far apart the values are from their mean.