Instrument relevance a. means that the instrument is one of the determinants of the dependent variable.
b. is the same as instrument exogeneity.
c. means that some of the variance in the regressor is related to variation in the instrument.
d. is not possible since and are correlated and and are not correlated.
Correct Answer:
Verified
Q1: Estimation of the IV regression model
A)requires exact
Q2: The TSLS estimator is
A)consistent and has a
Q4: Weak instruments are a problem because
A)the TSLS
Q7: If the instruments are not exogenous,
A)you cannot
Q9: When calculating the TSLS standard errors
A)you do
Q10: The conditions for a valid instruments
Q11: Consider a competitive market where the demand
Q12: The distinction between endogenous and exogenous variables
Q13: When there is a single instrument
Q18: (requires Appendix material) The relationship between
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