Which of the following is true of two stage least squares estimators?
A. The two stage least squares estimator is equal to the instrumental variable estimator if R2 is equal to 1.
B. The two stage least squares estimators are biased if the regression model exhibits multicollinearity.
C. The two stage least squares estimators have lower variance than the ordinary least squares estimators.
D. The two stage least squares estimators have large standard errors when R2 lies close to 0.
Answer: B
You might also like to view...
If real GDP grows at a faster rate than does population, then the standard of living, as measured by real GDP per person,
A) worsens. B) remains the same. C) cannot be measured. D) improves. E) either improves, worsens, or stays the same, depending on the size of the population and the actual level of real GDP.
All central banks are controlled by government
Indicate whether the statement is true or false
How could Lee be guilty of job-entry discrimination?
a. by paying women less for doing the same job as men b. by intentionally not interviewing white people c. by requiring men to work more overtime hours than women d. by offering incentives to minorities to apply there
If a product has only a few acceptable substitutes, demand for the product is most likely to be:
A. very inelastic. B. inelastic. C. elastic. D. very elastic.