Question

QUESTION 19

True or False: Adding more independent variables into the model
necessarily reduces bias.

True

False

2.5 points

QUESTION 20

True or False: By adding more independent variables into our OLS
model, we have a greater chance of getting rid of the endogeneity
that exists within the error term.

True

False

2.5 points

QUESTION 21

True or False: Given the model Income = β 0 + β 1 Parental income +
β 2 Male where Male is a dummy variable, β 0=30,000, β 1=0.1, and
β2=10,000, the expected income of a woman whose parents income is
$60,000 is equal to $52,000.

True

False

Answer #1

Question 19 = False

By adding more independent variables into model neccessary not reduces bias

Because multicollinearity occurs when independent terms in regression model are correlated

Question 20 = True

It is true by adding more independent variables into our OLS model we have a greater chance of getting rid of endogeneity that exists within the error term

Question 21 = false

The above statement is false because the expected income is not equal to $52000

:)

QUESTION 30
True or False: We can include a categorical variable (such as
region) in a multivariate model in the same way we include a
continuous variable.
True
False
2.5 points
QUESTION 31
True or False: We fail to reject the null hypothesis if the test
statistic is greater than the critical value.
True
False
2.5 points
QUESTION 32
True or False: We necessarily do not have an omitted variable bias
problem the omitted variable is uncorrelated with...

QUESTION 24
True or False: Measurement error in the dependent variable causes
our beta-hat estimates to be biased.
True
False
2.5 points
QUESTION 25
True or False: Perfect multicollinearity means all independent
variables are uncorrelated with each other.
True
False
2.5 points
QUESTION 26
True or False: Statistical tools allow us to prove the null
hypothesis is wrong.
True
False
2.5 points
QUESTION 27
True or False: The coefficient on the interaction of a dummy
variable and...

QUESTION 33
True or False: When conducting analysis using categorical
variables, we include a dummy variable for every category covered
by the categorical variable.
True
False
QUESTION 34
We are analyzing the effects of regime type on corruption rates
with the following model: Corruption = 10 - 0.1 GDP (per capita) -
2.0Democracy where Corruption is an index of corruption, GDP (per
capita) is measured in thousands of dollars, and Democracy is a
dummy variable that is equal to one...

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