Problem Sets Flashcards
What type of data are obtained by randomly sampling individuals from a large population at different points in time. Example: Current population survey (CPS) in 1978 and 1988
Independently Pooled Cross Sections
What type of data is where the same group of subjects (individuals) is followed
during each survey time period?
Longitudinal/Panel Data
What type of data is compiled by observing the same characteristics of one population over various time periods?
Repeated Cross Sections
unobserved effect
fixed error term (a “i”)
A high degree of correlation between 2 or more independent variables is…
Multicollinearity
Causes smaller SE’s, false precise appearing estimates, and false null hypothesis rejections.
Serial Correlation
The probability of getting a test statistic more extreme than the one obtained from the sample if the null hypothesis is true
P Value
The average of the OLS fitted values for any sample is always zero
False
When one includes an irrelevant independent variable in a regression, we call it “over controlling.”
False
Adding an additional observation to the dataset cannot cause a decrease in the value of R-squared.
False
If we were to change the units of measurement for one of the independent variables, the coefficient estimates for all independent variables would change.
False
Multicollinearity refers to the situation where the independent variables are highly correlated. Multicollinearity does not cause the OLS estimator to be biased, but it does generally increase the standard errors.
True
If an estimator is consistent, then as the size of the random sample increases the estimator moves towards the true population parameter value.
True
Omitting an independent variable that is correlated with the dependent variable from an OLS regression always causes the estimated coefficients on the included independent variables to be biased.
False
A confidence interval for a prediction is always at least as small or smaller than the corresponding prediction interval.
True
