Which of the following is not a common cause of endogeneity?
a.) measurement error
b.) simultaneous equations
c.) omitted variables
d.) continuous variables
Which of these assumptions indicates homoskedasticity?
a.) E(eit) = 0
b.) var(eit) = E(e2
it) = 2
c.) cov(eit, ejs) = E(eit, ejs) = 0 for i j or t s
d.) cov(eit, x2it) = 0, cov(eit, x3it)
In a GARCH(p,q) model, what does the q indicate?
a.) the number of lagged h terms
b.) the number of lagged e2 terms
c.) the number of endogenous variables in a system
d.) the number of excluded exogenous variables that can be instruments
When autocorrelation is present, which assumption of the linear regression model is
incorrect?
a.) E(et)=0
b.) var (et)= 2
c.) cov(et, e) =0, t s
d.) et N(0,ï€ ï³2)
The following economic model predicts whether a voter will vote for an incumbent
school board member INCUMBENT = 1 + 2MALE + 3PARTY + 4MARRIED +
5KIDS
where
INCUMBENT = 1 if the voter votes for them, 0 otherwise,
MALE = 1 if the voter is a male,
PARTY indicates the voter is registered with the same political party as the incumbent,
MARRIED = 1 for married voters, 0 otherwise, and
KIDS is the number of school age kids living in the voter’s house. If you hypothesize
males and females might have a different willingness to vote for a candidate registered
with a different political party, which variable should you add to the economic model to
allow you to test the hypothesis?
a.) MALE * PARTY
b.) MALE * MARRIED
c.) MARRIED * KIDS
d.) MARRIED * PARTY
Suppose you have a long, narrow panel of data and estimate a single equation with
indicator variables and interaction terms for the individuals. In doing this what
assumption from the pooled model have you maintained?
a.) coefficients on variables are equal across individuals
b.) errors are uncorrelated with any x‘s
c.) expected value of errors are zero
d.) variances of error terms are equal across individuals