The hardest part of implementing the instrumental variables approach is:
A. determining which of your instrumental variables are relevant.
B. finding and defending the exogeneity condition of your instrumental variable.
C. reporting the appropriate standard errors.
D. deciding between using two-stage least squares or generalized method of moments.
Answer: B
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You are doing research on rodent populations in a cornfield at night and are hearing popping noises. Your research assistant is getting scared. Having taken biology, you can explain to your assistant that the popping sound is due to
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