Which of the following Gauss-Markov assumptions is violated by the linear probability model?
A. The assumption of constant variance of the error term.
B. The assumption of zero conditional mean of the error term.
C. The assumption of no exact linear relationship among independent variables.
D. The assumption that none of the independent variables are constants.
Answer: A
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The inflation tax falls mostly heavily on
a. those who hold a lot of currency and accounts for a large share of U.S. government revenue. b. those who hold a lot of currency but accounts for a small share of U.S. government revenue. c. those who hold little currency and accounts for a large share of U.S. government revenue. d. those who hold little currency but accounts for a small share of U.S. government revenue.
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